Structured Settlement Installment Payments

If you were permanently injured as a result of a person or company being negligent or acting with intentional misconduct, you are standing at a crossroads for recovering money. The first thing would be to hire a reputable and qualified attorney who specializes in personal injury torts. From there, you would need to decide to go forward with a lawsuit, which would mean spending a significant amount of time in and out of the court system. Depending on your case, often going through the court specific to a lawsuit of this type it could take several years to receive any money.

If you were permanently injured as a result of a person or company being negligent or acting with intentional misconduct, you are standing at a crossroads for recovering money. The first thing would be to hire a reputable and qualified attorney who specializes in personal injury torts. From there, you would need to decide to go forward with a lawsuit, which would mean spending a significant amount of time in and out of the court system. Depending on your case, often going through the court specific to a lawsuit of this type it could take several years to receive any money. Additionally, you would need to consider the financial aspect of having an attorney spend all that time working on the case, not to mention your medical bills are not being paid and you are not receiving money on which to live.

The other decision would be for you and the other party to enter an agreement whereby money would be awarded outside of the court system. Then, if an agreement were reached, you could choose to have the money paid to you in one large sum or choose scheduled payments stretched out over a period of time. Known as a structured settlement, you could choose to have the money distributed in several ways. Although receiving one lump sum might seem like the obvious choice, the truth is that a structured settlement offers more benefits and it protects you from going through the entire settlement amount quickly only to end up with nothing.

How Do They Work?

In this article we wanted to provide information about the structured settlement installment payment so you can see why this is ultimately a much better solution over a lump sum payout. For starters, payments are provided for compensation after sustaining injury. This type of settlement is used for a number of different scenarios to include car accidents, medical malpractice, workplace injury, and other situations in which negligence was involved.

Once you have entered into an agreement to receive structured settlement installment payments, you are known as the “Annuitant” All payments received for this agreement are guaranteed via an annuity, which is maintained by a life insurance company. As a part of the process, you would have the option of choosing the frequency of each structured settlement installment payment.

However, the duration of these payments is the responsibility of the court or participating attorneys. No matter the schedule chosen, there are many instances in which you would also be able to choose a large sum of money to be paid every few years.

How Can I Increase My Payments?

The payments received are not taxed locally or federally with the exception of lottery winnings, which would be subject to both state and federal taxes. Without doubt, choosing settlement payments offers many benefits, one being flexibility. Working closely with your attorney and the insurance expert, you would be able to look at the different terms and options for small and larger payouts, finding the payment structure that works best for you. Having this level of flexibility means there are no cookie-cutter solutions but schedules according to each person’s needs.

Keep in mind that while choosing to receive your structured settlement installment payments for life does not always mean life. Sometimes, “life” is a reference to a set number of years based on your life expectancy. The payments established for a set amount of time are known as “period certain annuities.” Now, if you were to pass away prior to the settlement money being paid in full, any assigned beneficiary would start receiving the payments based on the terms you established. In this case, the settlement payments are referred to as “period certain”.

One very important note is that once you enter into a legal agreement to accept structured settlement installment payments, you cannot decide later to choose the lump sum payout. Although there are cases when the court would reverse the initial decision, this is rare. The only other possible way to make this change would be to hire a company that would purchase your settlement amount but in exchange, you would be responsible for paying hefty fees. Since a good deal of money would be paid for this type of service, you would be better off working with the original decision to accept structured settlement installment payments.