Take A Structured Settlement Or One-time Lump Sum Payment?
By Greg Smith, Thu Dec 8th

If you are involved with a legal decision, financial claim orinsurance arrangement, the financing process to settle andresolve the claim can often take two forms. Either a one-timelump sum payment, or a long-term periodic series of deferredstructured settlement payments. But which is best for yoursituation?

A structured settlement involves a financial or insurancearrangement which includes a periodic stream of payments, that aclaimant or plaintiff accepts in order to resolve a personalinjury claim or other legal case. They were first utilized inCanada and the United States during the 1970s as an alternativeto lump sum payments and are now part of the statutory tort lawof several common law countries.

A structured settlement is a deferred payment method forcompensating injury victims, and is a voluntary agreementbetween the injury victim ( plaintiff ) and the defendant. Theplaintiff will receive the monetary payout over the course of anumber of years through this deferred payment agreement. Under astructured settlement, an injury victim does not receivecompensation for their injuries in one lump sum, but rather,they will receive a stream of tax free payments designed to meetfuture expenses and living needs. This type of compensationmethod is becoming more popular in a wide variety of legal cases.

The benefits of a structured settlement over a lump-sum paymentinclude the security of a guaranteed long-term income withdeferred payments that are exempt from income taxes. The federalgovernment encourages the use of structured settlements inpersonal injury cases. Structured settlements also attractsupport from plaintiff attorneys, state attorneys general,legislators, consumer and disability advocates.

Structured settlements can be ideally suited for cases with:

* Persons with disabilities * Guardianship cases that mayinvolve minors * Workers compensation cases * Wrongful deathcases * Severe injury case

Want to Sell Your Structured Settlement? Not everyone benefitsfrom a long-term payment situation and some may want or need alump sum instead. The owner of a structured settlement, such aslottery winners, medical, insurance, accident and lawsuitsettlement owners, can often sell their rights to the deferredpayment stream, in exchange for a one time lump sum payment froma variety of financial institutions. All situations aredifferent, and as with any financial or legal issue, you shouldalways consult your accountant and attorney.

About the author:Greg Smith publishes the informational web site on StructuredSettlements at http://www.settlements-i.com/ . Visit the sitefor the latest on settlements of all types.