Structured Settlements

Personal injuries and traumatic events can occur to anyone at anytime. When this happens, it could leave the victim and the families in a financial mess. Large payouts from insurance companies are often times poorly managed and the victim and the families end-up financially worse than when they started. When clients are faced with these life-altering events, a structured settlement could help the family manage the money to be used for future medical care, education, retirement planning and other future needs.

While personal injury settlements are one of the most common, they are many other situations that would benefit from a structured settlement.  As an insurance producer or financial planner, recognizing the type of situation that would be suited is key. This "opportunity" can give you a competitive edge. How? The monies generated from a structured settlement can be used for financial planning: life insurance; long-term care; disability insurance; annuities, college planning and so much more. Start the conversation.

There are select-approved settlement professionals in the U.S. of those approved, MAF has access to one of the most well-respected teams in the industry. Please call us at (800) 979-9393 to learn more how structured settlements can create more opportunities for your practice.

Are structured settlements more likely to be used in certain types of cases?

Independent surveys suggest the more serious the injury, the greater the likelihood that a structured settlement will be used. Structured settlements are ideally used for:

  • Persons with temporary or permanent disabilities
  • Guardianship cases that may involve minors or persons found to be incompetent
  • Worker's compensation cases
  • Wrongful death cases where the surviving spouse and/or children need monthly or annual income
  • Severe injury, especially for those who require long-term care needs, living expenses or support of family.

What other types of cases can we use a structured settlement?

When you are speaking to your clients about financial planning, ask them where the premium dollars are coming from? Spotting a potential case, can help your clients better plan for their needs, allow you to cross-sell products and will put more money in your pocket!
The AdvisorUnderstanding the Role of the Structured Settlement Consultant
Divorce SettlementReal Estate Sales: Sales of Farms, Land, Investment Property, Sale-Leasebacks, Long-Term Leases, Highly-Appreciated Residential and Second Homes
Business Sales or Disability Policy Buy-OutsAttorney Fees
Employment Related Claims: Wrongful Termination, Age, Gender or Race DiscriminationSexual Harassment, Errors & Omissions (E&O), Directors & Officers (D&O)
Construction DefectsEnvironmental Litigation
Legal MalpracticeProperty Disputes
False Arrest/Imprisonment
Pre-& Post-August 5, 1977 Workers' Compensation Claims
Breach of ContractLottery or Contest Winners
Fraud ClaimsPsychological Damage Claims

What is a structured settlement?

Structured Settlements are an innovative method of compensation. Encouraged by the U.S. Congress since 1982, a structured settlement is a voluntary agreement between two parties such as the injury victim and the defendant.
For example, under a personal injury structured settlement, the injury victim doesn't receive compensation for his or her injuries in one lump sum. Rather, he receives a stream of tax-free payments tailored to meet future medical expenses and basic living needs. A structured settlement may be agreed to privately (for example, in a pre-trial settlement) or it may be required by a court order, which often happens in judgements involving minors.

What is the benefit of a structured settlement vs a lump sum payment?

A long-term structured settlement has advantages. First, there is security. A structured settlement provides guaranteed long-term income. That gives the victim or victim's family the ability to recover.
A second benefit is financial. When congress amend the federal tax code to encourage structured settlements, it explicitly provided that 100 percent of every structured settlement payment would be exempt from federal and state income taxes.