A structured settlement involves a financial or insurance arrangement which includes a periodic stream of payments, that a claimant or plaintiff accepts in order to resolve a personal injury claim or other legal case. They were first utilized in Canada and the United States during the 1970s as an alternative to lump sum payments and are now part of the statutory tort law of several common law countries.

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

The benefits of a structured settlement over a lump-sum payment include the security of a guaranteed long-term income with deferred payments that are exempt from income taxes. The federal government encourages the use of structured settlements in personal injury cases. Structured settlements also attract support 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 may involve minors * Workers compensation cases * Wrongful death cases * Severe injury case

Want to Sell Your Structured Settlement? Not everyone benefits from a long-term payment situation and some may want or need a lump sum instead. The owner of a structured settlement, such as lottery winners, medical, insurance, accident and lawsuit settlement owners, can often sell their rights to the deferred payment stream, in exchange for a one time lump sum payment from a variety of financial institutions. All situations are different, and as with any financial or legal issue, you should always consult your accountant and attorney.
About the Author

Greg Smith publishes the informational web site on Structured Settlements at http://www.settlements-i.com/ . Visit the site for the latest on settlements of all types.

A Quick Note From The Publisher... If you like the article above, you may be interested in the following article which is also related to Structured Settlements... Understanding Structured Settlements and their Advantages Put in simple terms, a structured settlement is merely an agreement that’s reached between a plaintiff and defendant that outlines the flow of payment that the plaintiff receives, due to injury. These payments – which are made over a specified period of time – do offer some advantages to the recipient and are advocated by many legal professionals, since they provide more benefits over time, when tax rates are factored in for consideration. When the payment system is set up, it can be customized according to the needs of the recipient and is issued through a stable financial institution. In cases where there will be ongoing medical expenses and/or living expenses that will be covered by such a settlement, it’s important to be comfortable with the experience and the history of success that the company offers. Among the many advantages of a structured settlement is the fact that the income that’s generated from this type of agreement is not included as part of the recipient’s annual...