Skip to content 
You got hurt at work. Now the insurance company is offering you a settlement and you are not sure if it is fair. That is common and also dangerous.
A workers compensation settlement in Arizona is not just a check. It is a legal agreement that closes your claim. If you sign a full and final settlement, you give up your right to reopen the claim later, and you cannot take that back. Most injured workers do not fully understand what they are giving up until it is too late.
What Is a Workers’ Comp Settlement?
A workers comp settlement is a financial agreement that resolves your workplace injury claim. The insurance carrier offers you a sum of money. You accept it. Your claim closes.
Every workers comp settlement in Arizona involves a calculation. That calculation is based on your injury type, your wages before the accident, your level of permanent disability, and your future medical needs. Get any of those numbers wrong and you leave money on the table permanently.
Arizona workers compensation benefits mainly cover two things. They cover your medical treatment. They cover your lost wages while you cannot work. A settlement is the insurance company’s attempt to put a final dollar figure on both of those things at once.
That distinction is exactly why injured workers need workers compensation attorneys before they agree to anything. Our attorneys at Harris Injury Law review the full picture of your claim before advising you on whether any offer comes close to what you actually deserve.
How Do Workers’ Comp Settlements Work in Arizona?
A workers comp settlement is a legal agreement between you and the insurance carrier. It resolves your workers compensation claim and determines what you receive for your injury.
Arizona law provides for full and final settlements under A.R.S. § 23-941.01, and it does not prohibit settlements that are not full and final. These are not the same thing and the difference matters enormously.
Here is what most injured workers do not know. The Industrial Commission of Arizona must approve a full and final settlement before it is valid, and it may not approve one that fails the statute’s requirements. Approval is not a finding that the amount is fair to you. Judging that is something to do with your attorney.
Harris Injury Law is a Phoenix workplace accident law firm and has recovered over $100 million for injured clients across Arizona. You can review our case results to see what fighting for the full value of a claim actually looks like.
What Is the Average Monthly Wage in Arizona Workers Comp?
Your average monthly wage is the starting point for every worker’s comp calculation in Arizona. It determines your permanent disability compensation and how much you receive while you cannot work.
Under A.R.S. § 23-1041, your average monthly wage is generally based on what you were paid in the month of your injury, and the Industrial Commission can use a longer period when that gives a fairer picture. That includes your base pay, overtime, tips, bonuses, and any other regular compensation your employer paid you. How Arizona calculates it. In a simple case, add up your total earnings for the period used and divide by the number of months in that period. If 12 months are used, divide by 12.
Here is an example. Maria works at a Phoenix warehouse and earns $48,000 per year. If 12 months of earnings are used, her average monthly wage is $4,000. That number becomes the foundation of every benefit calculation tied to her workers compensation claim.
What Counts as an Unscheduled Injury?
Not every work injury fits neatly onto a chart. Some injuries affect your ability to earn a living in ways that cannot be reduced to a simple number of weeks of compensation.
Arizona law calls these unscheduled injuries. They are handled differently and can be worth significantly more to pursue. Common unscheduled injuries in Arizona workers comp claims include:
• Back and spine injuries
• Neck injuries
• Head injuries and traumatic brain injuries
• Internal organ damage
• Psychological and psychiatric conditions caused by a work accident
• Injuries affecting multiple body parts simultaneously
• Conditions that affect your capacity to work across all job functions
If your injury falls into any of these categories, your settlement is not calculated using a fixed chart. It is calculated using your loss of earning capacity.
What Qualifies as Permanent Total Disability in Arizona?
Permanent total disability means your work injury has left you permanently unable to engage in any gainful employment. Not just your old job. Any job.
Some work injuries do not just limit what you can do. They take away your ability to work entirely. Arizona workers compensation law recognizes this category separately. This is the most serious outcome in a workers compensation claim and it carries the highest level of benefits Arizona law provides.
Under A.R.S. § 23-1045(C), disability is presumed to be total and permanent, in the absence of proof to the contrary, if it is caused by:
• Total and permanent loss of sight in both eyes
• Loss of both feet by separation
• Loss of both hands by separation
• Loss of one hand and one foot by separation
• An injury to the spine resulting in permanent and complete paralysis of both legs, both arms, or one leg and one arm
• An injury to the skull resulting in incurable imbecility or insanity
This list is not exclusive. Under A.R.S. § 23-1045(D) and § 23-1047, other injuries can still qualify, depending on the facts of your case, including the medical and vocational evidence. That finding requires strong medical evidence and an attorney who knows how to present it.
Frequently Asked Questions
What is the average workers comp settlement amount in Arizona?
There is no fixed average. Every settlement depends on your injury, your wages, your impairment rating, and your future medical costs. What matters is whether your settlement reflects the full value of your specific claim.
How is a workers comp settlement calculated in Arizona?
It depends on your injury type. Scheduled injuries use a fixed compensation chart. Unscheduled injuries use the Loss of Earning Capacity formula: 55% of the difference between your pre-injury wage and your post-injury earning capacity. Permanent total disability pays 66⅔% of your average monthly wage for life.
How much does workers comp pay in Arizona for temporary disability?
Temporary total disability pays 66⅔% of your average monthly wage. Temporary partial disability pays 66 2⁄3% of the difference between your pre-injury wage and your current light duty wage. Both stop when you reach Maximum Medical Improvement.
Can I reopen my workers comp claim after a settlement?
It depends on what you signed. A full and final settlement waives the right to reopen the claim. A settlement that is not full and final may leave that right in place, depending on its terms. Understand exactly what you are signing before you agree to anything.
Does workers comp cover arthritis or repetitive stress injuries in Arizona?
Yes. Arizona workers comp covers gradual-onset conditions including work-related arthritis. You must show your job duties caused or aggravated the condition. These claims are regularly disputed by insurance carriers and are harder to win without an attorney.
What is an impairment rating and how does it affect my settlement?
An impairment rating is a percentage assigned by your doctor at Maximum Medical Improvement. It measures your permanent physical loss. A higher rating means higher compensation. An insurer may also rely on an IME doctor, whose rating can be lower than your treating doctor’s. Harris Injury Law challenges those ratings when the evidence does not support them.
How long does a workers comp settlement take in Arizona?
Timing varies with the complexity of the claim and whether your impairment rating is disputed. Once a full and final settlement is approved, the lump sum must be paid within 15 days after the award becomes final.
Talk to a Phoenix Workers’ Compensation Attorney
If you are searching for help after a workplace injury, you are already doing the right thing. Call us with your questions. We are here and consultations are free.
Harris Injury Law, PLLC 1136 E Campbell Ave, Phoenix, AZ 85014 (480) 800-4878
Consultations are free and cases run on a contingency fee, meaning no attorney fee unless compensation is recovered. Request a consultation or meet our attorneys. Every case depends on its own facts; no outcome can be promised or predicted.
This article provides general information about Arizona workers compensation law and is not legal advice. Reading it creates no attorney-client relationship. Arizona statutes and court rules change and outcomes depend on the specific facts of each claim. Consult a licensed Arizona attorney about your situation.
Reviewed by Jason A. Harris, Harris Injury Law, PLLC.
