GQ Corner
Q: I have a fatality claim where we are paying death benefits to the widow and one dependent. There was third party settlement and as a result there is a statutory future credit in the amount of $16,905.67. Can we take the credit back from the death benefits and stop paying until the credit is exhausted? Or do we just deduct a percentage until the credit is taken in full?
A: First, take a look at the settlement papers to see what the distribution is. Next make sure the carrier did not waive its lien. If the carrier did not waive the lien, then it is entitled to take a holiday until the lien is exhausted. Thus, nothing is paid until the lien is exhausted. Once the lien has been exhausted, carrier would begin paying benefits again if benefits are owed otherwise.
Q: I have an employer that has recently requested to be copied on all legal correspondence. However, my understanding is that we do not allow these types of communications in Texas. Can you please explain the legal ramifications if the employer is copied on correspondence between our defense firm and the carrier?
A: The XL Specialty case from the Texas Supreme Court held that any communications between the employer and carriers’ attorneys are not privileged communication. These communications are therefore discoverable. Therefore, in order to protect and maintain the privilege, attorneys in Texas cannot exchange or provide correspondence with the employers.
Q: I received a child support order on my death claim. The named child is the child I am paying as a beneficiary, as well as that child’s mother whom I am also paying as a beneficiary. How do I handle this?
A: The consensus is that death benefits belong the beneficiaries and not the decedent. Therefore, the benefits are not subject to the lien. You will need to complete the response at the top of the last page indicating that “Withholding and/ or lien cannot be placed” because “The obligor died on _________ and currently all death benefits are being paid to the beneficiaries. The beneficiaries are the child listed on this order and the mother of the child, the obligee listed on the order. Death benefits are owned by the beneficiaries and not the decedent and are not subject to the lien.”
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