What is a Structured Settlement?

A structured settlement is simply a mechanism that allows plaintiffs to have a portion of their personal injury or wrongful death settlement paid out in future tax-free periodic payments. The design of the payments is limited only to the imagination – giving the plaintiff complete flexibility in securing their financial future. 

Historically, damages from a personal injury or wrongful death lawsuit were paid in a single lump sum at the time of the settlement. This kind of payment placed plaintiffs and their families in the position of having to manage a large sum of money, which is often intended to provide for a lifetime of medical and income needs. Structured settlements were devised to alleviate the difficulty of this situation and to provide long-term financial security for families.

A structured settlement also makes it an ideal financial vehicle for many of life’s other fiscal challenges such as financing a child’s college education, planning for retirement, estate planning, responsible investing through dollar cost averaging, or fixed income investing.

Structured Settlements have numerous advantages:

• TAX-FREE – IRS Code 104(a)(2) stipulates that periodic payments in the form of a structured settlement are completely tax-free. 

• GUARANTEED RATE OF RETURN – Structured Settlements grow at a guaranteed fixed rate of return unaffected by the volatility of the market. The rate of return exceeds most other fixed income investment options. Coupled with its tax-free status structured settlements often out-perform investment options offered within the equity market.

• GUARANTEED FUTURE PAYMENTS – In the form of future periodic payments structured settlements promote fiscal responsibility and investment discipline. The fixed nature of structured settlements provides the assurance that the plaintiff’s future needs will be secured over a specific period or a lifetime.

• MINIMAL RISK – Structured Settlements are funded through multi-billion dollar life insurance companies. We place structured settlements with the most secure life insurance companies in the world.

• NO FEES – Unlike typical investments, structured settlements contain no management fees. Our services are offered at no cost to the plaintiff or the plaintiff’s attorney. 

FREQUENTLY ASKED QUESTIONS

How Financially Secure is a Structured Settlement?

Sanctioned by the federal government, Structured Settlements are funded through multi-billion dollar life insurance companies. We actively places structured settlements with the most secure life insurance companies in the world. 

Will the Payments be Guaranteed in a Structured Settlement?

Unlike investment programs, stocks and other interest bearing financial instruments which carry risks and experience fluctuations in stock markets – structured settlements give you financial security, and guaranteed tax-free payments. 

Who is Eligible for a Structured Settlement?

A plaintiff that is currently involved in a personal injury or wrongful death lawsuit and has not yet signed a release or received compensation.

What are the Risks Involved in Investing in a Structured Settlement?

Structured settlements are virtually risk-free. All of our structured settlements are placed with the strongest life insurance companies in the world. Therefore, there is a minimal amount of risk that a structured settlement will ever default.

Why are Structured Settlements Tax-Free?

The Internal Revenue Code (IRC) section 104(a)(2) allows plaintiffs involved in a personal injury lawsuit to receive their settlements in future periodic payments excluded from taxation.

Can a Structured Settlement be Changed After it Has Been Implemented?

Once a plaintiff has agreed to a structured settlement and has executed the settlement documents the structure has become a permanent part of the settlement. It is important to understand that due to the fixed nature of structured settlements we do not encourage individuals to place all of their settlement proceeds into a “structure.” A certain portion should be taken in the form of upfront cash to satisfy potential emergencies or other diversified investments.

What Documentation is Supplied After a Structured Settlement is Set Up?

All life insurance companies issue a structured settlement annuity policy after they receive the necessary documentation. We work hard to gather all of the necessary information and documentation from the parties involved to ensure that the policy is forwarded in a timely manner.

After a Policy is Issued What Happens if the Plaintiff Moves or Wants to Change Their Beneficiary?

The claimant may contact the life insurance company directly with the contact numbers published in their policy or they may contact us. Our services are life long, and we will continue to service the policy as long as it is in force.