Structured settlements are the alternative to lump sum payment amounts.

This type of Settlement is a financial agreement in which the personal injury claimant agrees to receive future payments structured over a fixed length of time. Also known as periodic payments.

Documents generated:

  • an agreement
  • an annuity application,
  • a qualified assignment
  • a court order (if the claimant is a minor)
  • an annuity policy

Things to consider:

  • The date of commencement of payment
  • the duration of the agreement
  • monthly expenses
  • present age of the individual
  • extent of hazard in occupation
  • retirement plans

Advantages of Structured Settlements:


It provides cash at regular intervals, guaranteed by contract.

Not having to deal with the risk of investing and managing a large sum of money and exhausting all the settlement funds.

Lower Costs

It can be settled without having to go to court. (no need to pay in-court settlement and attorney costs can be reduced by 8 to 12 percent for an out-of-court settlement than if a litigation were to be filed in court.

Tax Exemption

Structured payments received in a workers' compensation or physical injury claim are free of state as well as federal taxes.

To ensure that the payments remain tax-free, the structure of payments should not be altered after been agreed upon by both parties.


Peace of mind for the injured person and their family as lifetime benefits would eliminate the worry of outliving his or her funds.

Defendant is contractually bound to pay the plaintiff.


Structured payments usually start 30 to 45 days after the receipt of the court order.

Lifetime plans or short term plans can be designed.

You can get a lump sum payment by selling a part or all of your monthly annuity or settlement. There are many companies that can buy your structured settlement all over the United States.

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DISCLAIMER: The law will vary depending on your state, jurisdiction and the specifics of your case. The information provided by is intended for educational purposes only. The content on this site should NOT be considered professional legal advice or a substitute for professional legal advice. For such services, we recommend getting a free initial consultation by a licensed Attorney in your state.

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