To encourage employers and their insurance companies to pay benefits in a timely manner, many states impose penalties when benefit checks are late. In California, for example, disability benefits are due every two weeks. If a payment is late, you can receive an additional 10% of the amount past due. If the delay continues for an unreasonable amount of time, you can receive a 25% penalty, up to $10,000. In Virginia, you can a 20% penalty if your payment is more than 14 days late.
In some states, the penalty will depend on whether your benefits have been ordered by the workers’ compensation board. For example, in Georgia, you can receive a late penalty of 15% if the insurance company is paying your benefits voluntarily (meaning that a judge didn’t order payment). However, if a judge ordered payment of the benefits and the check is late, you can receive a 20% late penalty.
These penalties are usually automatic, meaning that you won’t need to file any paperwork or prove anything at a hearing. If your check is late, you are entitled to the penalty. In theory, the insurance company should automatically add the penalty to your next check. However, insurance companies often won’t do this voluntarily. In that case, you will need to request the penalty from the insurance company. If you do this over the phone, you should send a follow up letter or email to confirm it in writing. If the insurance company refuses to pay, you may need to ask the workers’ compensation board to order the insurance company to pay the penalties.
In some states, you can also recover interest or reasonable attorneys’ fees. For example, in Florida, you can receive interest at a rate of 12% per year for any late payments. In New Jersey and California, you can collect reasonable legal fees incurred in trying to recover the late payment.
If your checks are consistently late, or withheld unreasonably, you should talk to an experienced workers’ compensation lawyer. A lawyer can help you recovery any penalties, interest, and legal fees to which you’re entitled.