Workers' Comp Death Benefits Funneled To Insurers
Posted by
Dan DeutermanJune 01, 2007 1:42 PMA recent investigation by the Houston Chronicle revealed that that $17 million in workers' compensation benefits have been denied to families of workers killed on the job.
Under Texas law, when a worker is killed on the job, and does not have a spouse, dependents or any family members that can prove they were financially dependent on the worker, the death benefit money is moved to the Subsequent Injury Fund. This fund was originally set up for injured workers who need extra help after suffering multiple injuries.
However, under a law enacted in 1991, insurers in Texas can request reimbursement from this fund to help recoup losses. Between 2003-2006, more than $10 million from this fund found its way back to insurance companies' bank accounts.
One father of a college-aged son who was killed on the job calls it "blood money."
Why are insurance companies in Texas financially benefiting from the deaths of workers? Why doesn't this money just stay in the Subsequent Injury Fund to help those truly in need? Some people in Texas are beginning to sit up and take notice and are working to change the laws to more fairly benefit workers and their families in these wrongful death cases.
The state legislature in Texas is considering action that would ensure that family members receive these benefits when a loved one is killed on the job.