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In the past, the court always awarded a lump sum of money to any plaintiff that won his or her personal injury case. Today, though, the judges in some courts ask if the plaintiff will agree to a structured settlement.
What is a structured settlement?
That is an arrangement agreed to by both parties. Under the terms of that agreement, the plaintiff receives a pre-determined amount of money on a periodic basis, normally once a month.
When and where do the settlement’s details get discussed and determined?
After a judge and jury have made a decision in a personal injury case, if the plaintiff has been awarded a large sum of money, the judge might meet with the plaintiff’s Personal Injury Lawyer in Sudbury, in order to find out if the attorney’s client might agree to a structured settlement. At that time, the judge would need to present some detailed information on the exact nature of any such arrangement.
What are the pro aspects associated with such settlements?
The plaintiff that has been awarded a specific and a large amount of money does not have to worry about using it all up in a short span of time. The payments arrive at a scheduled time; the recipient can make plans with the payment’s arrival in mind.
The government does not tax a single payment, even though each of them arrives according to a schedule, much like the way that a paycheck gets delivered. Because the payments are relatively small, none of them has to be managed, unlike the situation with a large sum of money. The money received remains protected from creditors.
What are the disadvantages to choosing the system that allows for structured payments?
The settlement that arranges for such payments gets made by those that have no idea what specific needs the plaintiff might have in the future. There is no flexibility in the system that arranges for delivery of money that is part of a structured settlement. The awarded plaintiff gets stuck with the need to work with that inflexible system.
Plaintiffs that agree to a structured settlement surrender any ability to make choices, regarding how to handle the money that was awarded by the court. Plaintiffs that have agreed to accept scheduled payments, rather than a lump sum payment, have no source of emergency cash, if an emergency arises.
The agreement must be secured by a viable insurer. The court defines a viable insurer as being one that offers proof of financial strength. The insurer holds the money that will be sent periodically to the plaintiff. The court wants to feel certain that the insurer will not feel tempted to spend the money that has been promised to the plaintiff.