Causes of Litigation in Worker's Compensation Programs

Rising litigation rates in state workers' compensation systems are often blamed for the rising costs of workers' compensation insurance. Yet until now, there has been little empirical evidence produced on the characteristics of injured workers and their employers that affect litigation decisions.

By applying econometric analyses to case data from two states, Falaris, Link and Staten identify the economic incentives influencing the probability of litigation in workers' compensation cases, and the probability that a contested case is pursued to verdict. Factors identified that influence these decisions to litigate include:

• Type of industry
• Part of body injured and type of injury
• Age of injured worker.
• State regulation of workers' compensation insurance pricing

An overview of the evolution of state workers' compensation systems is also presented, along with a discussion of the reforms implemented as attempts to stem the rising incidence of litigation.

137 pp. 1995
$15 paper ISBN 0-88099-161-5 / ISBN-13 978-0-88099-161-2.

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