Deciding on whether to accept a settlement offer from the negligent driver’s insurance company is one of the big decisions that you must make when pursuing your right to compensation. You want to be certain that you receive the best settlement possible given the strengths and weaknesses in your case. However, how you receive the payment is also an important consideration that you do not want to ignore. In some cases, it can be beneficial to accept the settlement payments in a structured settlement.
What Is a Structured Settlement?
In the majority of car accident claims, the victim accepts a lump sum payment of the settlement amount he is owed. However, a person who has suffered a catastrophic injury that will prevent him from working in the future or who does not handle large sums of money well may prefer to receive his payments over time. He can do this through the use of a structured settlement. Under this type of settlement, the insurance company typically purchases an annuity insurance policy that makes payments to the victim according to the payment schedule agreed upon. Many of the terms of the agreement can be negotiated including the following:
- Time period that the payments will be made
- How often the payments are made
- Amount of the payments, which can change over time to meet the victim’s needs better
- Whether there will be a larger lump sum payment at any time during the payment period, such as at the beginning of the agreement when the person may need to catch up payments on his bills
- Whether the settlement will end upon the victim’s death or provide for dependents after his death if the settlement amount is large enough
If you are considering entering into a structured settlement, you need to discuss this with an experienced car accident attorney to be certain that it is right for you. You also want your attorney to review the settlement agreement to ensure that the terms of the structured settlement are accurately stated. If you need assistance negotiating your settlement following a car accident, call our office to schedule a free consultation with a member of our legal team.