What Is A Structured Life Settlement?
In personal injury and workers comp cases, when the company is liable to pay the injured party a large amount of money, instead of paying it in a large lump sum, there is a structured life settlement that is agreed upon.
The structured life settlement is a way that the responsible party can pay the injured party in periodic payments over a long period of time. Even though it states it is a structured life settlement, it can be configured and customized to the benefit of the injured party.
If there are still payments left after the injured party dies, then that money will go to any beneficiaries that were added to the structured life settlement. On the beneficial side of the injured party, the structured life settlement is also given tax breaks and sometimes is even totally exempt from taxes all together.
The reason the structured life settlement has become so popular is because it has been found that when they use to just give the injured party a lump sum of money, the injured party was not able to budget this money well enough to make it last and to give them the possible continued medical treatment that was needed over a long period of time. So, the structured life settlement was put in to play and now there are a lot more people who have been hurt on the job and years down the road, they are still able to afford their rehab and their medicine or whatever is needed to help them in their life because they are getting a guaranteed income every month from their structured life settlement. There are also other forms of the structured life settlement beside the personal injury or workers comp type. There are also structured life settlements for lottery winners and life insurance policies. For lottery winners, the structured life settlement is very beneficial because if they take it all in one lump sum, there is a major amount of taxes that have to be paid on the lottery winnings. Also, they will benefit from the structured life settlement because it will last longer for them in their life. The life insurance policy per the structured life settlement is where the owner of the policy sells their policy for a structured settlement because they may need the money for their present life instead of when they would be able to get it and that is when they die.
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