Posted: October 21, 2013
When a personal injury lawsuit is settled in favor of a plaintiff, the plaintiff will typically have a choice between whether to take a structured annuity versus a lump sum payment. While structured annuities will involve regularly monthly (or yearly) payments to the individual for a set amount of time (which, in some cases, could be for the rest of a person’s life), with a lump sum payment, the individual will receive the total amount of the personal injury settlement in one payment.
The following are some conditions in which choosing a structured annuity payment for a personal injury settlement will generally be a better option:
- The individual will not have direct control over the money and, as a result, can benefit significant tax breaks.
- The individual is concerned with spending all of the settlement money. This is a valid concern, as studies have shown that the majority of people who opt for a lump sum personal injury settlement generally spend all of the settlement money within about 5 years of receiving it. In cases when the individual has spent his personal injury settlement and is unable to work or earn a living, he may need to turn to other outlets – like government assistance – for support.
- The individual is concerned about having changing medical needs in the future or wants to be able to try new potential medical treatments that may not have been around when the structured annuity was developed.
Additional benefits of choosing a structured payment over a lump sum payment include that:
- The structured annuity will likely be protected in the event that an insurance company later goes bankrupt. This means that the company will still be required to pay the annuity.
- Agreeing to a structured payment may help move a dispute closer to a resolution in the event that the defendant and plaintiff are at an impasse.
St. Louis Personal Injury Lawyers
If you have suffered any type of personal injury, contact the St. Louis personal injury lawyers at Brown & Brown Attorneys at Law. We have a long-standing commitment to serving our clients, and we are experienced at aggressively defending our clients’ rights in any legal setting. Our goal is to preserve and promote the rights and welfare of individuals and families who have suffered injuries and losses and/or who need help navigating through the complexities of the court system.
Since 1993, our lawyers have been successfully representing our clients in various areas of personal injury litigation, including car accident lawsuits, brain injury lawsuits, etc. Our unwavering dedication to the pursuit of justice in every case we handle means that we will work relentlessly to help our clients achieve the best possible outcomes to their cases. One of our primary goals is to help accident victims secure the maximum possible compensation for their injuries and losses so they can focus on their recovery and moving on with their lives. For a free initial consult, email us using the form at the right-hand side of the screen and/or to call us at 573-333-3333 for our Missouri office or at 618-888-8888 for our Illinois office.