Structured Settlements as Personal Injury Insurance


For the most part, you would enjoy a number of benefits that come from structured settlements as personal injury insurance but there are a few negative aspects to consider.  We wanted to offer information that would cover both the good and bad of a legal agreement such as this so you would have more information when it comes to making a decision.  The thing to remember is that a structured settlement is designed to provide you with consistent cash flow after being injured by a negligent party and if unable to work, this money is crucial to survival.


For the most part, you would enjoy a number of benefits that come from structured settlements as personal injury insurance but there are a few negative aspects to consider.  We wanted to offer information that would cover both the good and bad of a legal agreement such as this so you would have more information when it comes to making a decision.  The thing to remember is that a structured settlement is designed to provide you with consistent cash flow after being injured by a negligent party and if unable to work, this money is crucial to survival.

As you will see with this information, there are good and not so good aspects of structured settlements but when compared to taking all the money awarded as a lump sum payment, this is without doubt the wiser choice.  For one thing, you would enjoy security by knowing the amount of income each month and receiving the money as scheduled.  If you were to go with a lump sum payout, risk exists that the money would not be spent wisely while with a settlement, the money is more controlled on your behalf through the court.

One of the biggest advantages of taking the award money in the form of a structured settlement is that you would not be taxed.  Therefore, the amount predetermined for the payment is the exact dollar amount you would receive each month.  The drawback is that the money also does not accrue interest.  Again, the amount awarded is the amount you get paid regardless.  Again, comparing this option against the lump sum payout, the amount of accrued interest on the settlement would not usually be significant.

Now, one thing to consider when it comes to structured settlements as personal injury insurance is that because you receive payments, if you needed a large sum of money immediately to handle large expenses some other type of arrangement would need to be made with the creditor.  On the other hand, the lump sum payout would give you the funds needed for a situation such as this but remember, because there are more benefits with the structured settlement long-term, it would be worth making arrangements for the medical bills.

You will also discover that the level of flexibility with structured settlements as personal injury insurance is somewhat limited.  The reason is that according to law, once the agreement has been determined and the paperwork signed by the responsible party and you, it becomes legal.  That means the deal is done and for the most part cannot be changed.  As mentioned, you have a few options but they come at a cost so flexibility is something to consider.

Structured settlements are a type of insurance policy meant to protect you if you were to experience a horrible accident.  Yes, you do have options and yes, you could choose to take all the money and run but to enjoy the benefits and put yourself in a position of receiving consistent income, the solution is the structured settlement over the lump sum payout hands down.
 

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