Can my personal injury claim end in a structured settlement?

When you find yourself in the middle of a personal injury lawsuit, your mind is constantly on the move with questions about all the possible outcomes of your case. Although you may have an experienced personal injury attorney on your side who is fighting for your rights to compensation, it can be difficult to settle down until the case is fully resolved.

Many people are concerned about their settlements and wonder how they will get paid in the end. Questions like “Will I get all my money at once?” and “Can my compensation be awarded as a structured payment?” are common concerns of most personal injury plaintiffs.

Structured settlements

A structured settlement is an agreed periodic payment plan in which the recipient receives a specified amount of money over a specified period of time; and they are a common result of a personal injury settlement. There are advantages and disadvantages to structured payments, depending on your particular perspective.

The number one benefit of a structured settlement is that you generally get more money overall. In a lump sum payment, the amount is generally negotiated lower. Another important benefit is personal financial management. When a large sum of money is paid overtime, it is generally easier to manage your finances, pay bills, save money, and maintain a positive financial portfolio. It can also be especially beneficial in terms of tax obligations.

Additional benefits:

• Easier tax planning
• Possible benefits of income tax
• Additional annual income
• Broader grant opportunities
• Budget protection

One of the common disadvantages of the salary structure is limitation. For those who consider themselves financial savvy, not receiving their full compensation can be a major constraint, as you cannot use the money to make lucrative investments. In other cases, a personal injury victim has already paid all hospital bills, medical bills, and other related expenses out of pocket. They have also incurred loss of wages from work; therefore, not receiving full payment can be frustrating, as victims in this type of situation are simply trying to get the money back where it was before the accident.

The result of a structured agreement

If you win your claim and an insurance company agrees to give you a structured settlement, you won’t receive a paycheck right away. Instead, you will be paid a fixed amount over a set period of time. The terms of structured settlement agreements vary from case to case, and payment amounts and schedules can be set in many different ways. These payments generally begin as soon as all the paperwork is processed; however, this time frame can vary and can sometimes take up to a year to start receiving payments.