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Iowa: $1 Million Lump Sum Approved by Court

December 26, 2020 (1 min read)

An Iowa appellate court affirmed a decision by the workers' compensation commissioner allowing the commutation of a claimant's future permanent total disability benefits for a lump sum slightly in excess of one million dollars. Construing Iowa Code § 85.45(1)(b) (2016), the court agreed that the lump sum payment was in the best interests of the injured worker. Noting that the 68-year-old worker and his spouse had accumulated substantial retirement income that was separate and apart from the monthly workers' compensation disability benefits, the court also acknowledged that one of the prime reasons the worker wanted the commutation was his fear that benefits would abate at his death and his wife would be "left with nothing." Again, as just noted, that would hardly have been the case, particularly since $100,000 of the lump sum was to be used to pay off the mortgage on the couple's residence. Practitioners should note that the 2016 version of the statute was amended one year later so as to require the consent of the employer/carrier to any lump sum distribution.

Thomas A. Robinson, J.D., the Feature National Columnist for the LexisNexis Workers’ Compensation eNewsletter, is co-author of Larson’s Workers’ Compensation Law (LexisNexis).

LexisNexis Online Subscribers: Citations below link to Lexis Advance.

See United Fire & Cas. Co. v. Hessenius, 2020 Iowa App. LEXIS 1127 (Dec. 16, 2020)

See generally Larson’s Workers’ Compensation Law, § 132.07.

Source: Larson’s Workers’ Compensation Law, the nation’s leading authority on workers’ compensation law

For a more detailed discussion of the case, see

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