Are you having a tough time deciding whether to go with a structured settlement or accepting a lump sum payment? Structured settlements can be more beneficial than you might think at first especially if you have suffered an injury resulting in a chronic condition at the hands of another person, group or association. Anyone with a personal injury resulting in a claim would be doing themselves a favor to purchase a settlement, which can be set to dispense set amount to a recipient annually, twice a year or four times a year. How the money is to be dispensed is typically arranged between the two parties involved, usually with lawyers for each party present.

There are several reasons why someone who has suffered an injury would prefer this type of payment plan over others. First of all, the lump sum may take time to show itself. Defendants are not often able to come up with a large sum of money to pay off the medical expenses of a patient, leaving the patient waiting for the money. Compensation may never arrive, as is often the case in situations like this. If a suffering party expects a lump sum, the defendant may find a loophole that will work in their favor. They may not be required to pay a lump sum after all, leaving the patient with a load of unpaid hospital bills. Being paid in small increments over time is a much better option than being entitled to nothing at all. Often a court will declare structured settlement the necessary method of payment, upon hearing both parties and allowing those parties to discuss the matter amongst themselves. This is done because it has been determined that this kind of settlement will best benefit the plaintiff.

When settlements occur outside of court, the structured kind is the most-oft settled-upon payment plan. Both parties feel that they can live with a plan that they determine, allowing the defendant to come up with a plan that he is able to meet and the plaintiff an income to pay any medical bills. Settling out of court is a great option for those who want to have more control over the payment plan, and to avoid litigation altogether.

When the settlement is created, it is done with the help of a broker. First, both parties must agree to use a settlement plan, and then the broker steps in to negotiate the terms of the plan with the legal teams of each party. Brokering the deal may take quite some time from weeks to months to years as both sides must agree that the price is right. When a deal is finally signed, defendants must make payments according to the plan.

Usually, life insurance companies pay out these settlements in the form of annuities. Settlement plans are made or stalled according to premiums and rates offered by insurance companies. Often plaintiffs are made to wait weeks before a payment arrives. To avoid problems with an insurance agency, the plaintiff’s legal team must present its case and go after the settlement with zeal.

Author Bio: Stewart Wrighter recently researched a landmarkstructured settlement case for an article. He learned that structured settlements are the best alternative in some cases.

Category: Finances
Keywords: structured settlement,structured settlements