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Can I Borrow Money on My Workers’ Compensation Case?

Posted on June 4, 2021 in

The correct and short answer is no but read further if you want to know why.  To comply with Georgia law, an attorney’s fee contract must include the following provision:

No party or any party’s attorney shall enter into a loan or assignment with a third-party creditor which requires repayment from the proceeds of a workers’ compensation claim. A third-party creditor shall not include a medical provider who has provided reasonable and necessary medical services to the employee pursuant to the fee schedule.

The Laws in Georgia Regarding Workers’ Compensation Loans

Georgia statute OCGA 34-9-82 prohibits loans on any workers’ compensation claim and Rule 84 is the Georgia State Board of Workers’ Compensation (SBWC) rule.  It provides:

No party to a claim or any party’s attorney shall assist, secure, create, or execute any loan or assignment with a third party creditor which requires repayment out of any recovery, settlement, or payment of benefits from any claim filed under this chapter. A third-party creditor shall not include a medical provider who has provided reasonable and necessary medical services to the employee pursuant to the fee schedule.

Since a workers’ compensation claim cannot be assigned it is not an asset for bankruptcy estates.

There are some injury money lenders who will sign up a loan on a workers’ compensation claim.  They typically try to get around the rule by making the loan subject to another state, not Georgia.  However, the loan is not enforceable in Georgia since the claim cannot be assigned.

An exception to the assignment rule is that medical treatment can be arranged in Georgia so that an injured worker can get treatment when the claim is denied in Georgia.

If you have questions about your workers’ comp claim or any other aspect of the workers’ compensation system, contact our firm for a free consultation.

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