Workers injured in the clean-up following the World Trade Centre bombings on September 11 2001 will receive greater compensation after a new deal was agreed in New York last week.

Lawyers representing firemen, police officers and construction workers have been arguing for a better compensation deal from WTC Captive Insurance, the company set up by New York City to cover contractors without commercial insurance coverage.

The new deal increases the pool of available funds by about $US125 million ($147 million), with at least $US625 million ($738 million) to be split between about 10,000 claimants.

US District Judge Alvin Hellerstein, who instructed lawyers from both sides to craft a fairer deal, rejected the original deal as “inadequate”.

In order to find additional cash, lawyers had to reduce their commission fee from 33% to 25%, while WTC Captive Insurance added an extra $US55 million ($64.96 million) to the pool.

Claimants will receive a share of the pool based on a formula determining the severity of their injury. Those suffering blood and respiratory cancers will also be enrolled in a specially designed life insurance policy.

A minimum of 95% of claimants must now accept the deal for it to proceed.

Since its creation in 2004, WTC Captive Insurance has been heavily criticised for paying out more in legal fees than medical claims. US Congressman Jerrold Nadler claims more than $US103 million ($121 million) has been paid to lawyers while claimants have received only $US320,936 ($379,097).