Structured Insurance Settlement
Benefits of a Structured Insurance Settlement
When faced with the decision about accepting a structured settlement, or selling the settlement to receive a large lump sum payment, there are a few things to remember. For many reasons, it’s found to be a better decision to accept the structured settlement.
Here are the benefits of choosing the structured settlement option:
1. The money received from a structured insurance settlement is not taxed by the IRS.
2. When you receive money over a period of time, instead of in one large lump sum, you usually have less problems with family and close friends constantly trying to borrow money.
3. Recipients of structured settlements don’t usually have the problem of where to invest large sums of money. The money is used for their day-to-day living expenses.
4. Very often, when a structured insurance settlement is offered, there isn’t a worry about having to go to court. It’s usually settled out of court, and the person who is being offered the structured settlement saves court costs.
For many people there is a lure of receiving a big lump sum of money. This lure makes people really consider selling their structured settlement for cash. In many cases, the structured settlement can really be the better of the two choices.
Often times, when people have a big sum of money they forget that the money isn’t going to last forever. They begin going on a spending spree and the money is gone before they know it. With a structured settlement, you are sure to have money for the future and there isn’t the worry about spending it all at once.
FAQ – Frequently asked questions about structured settlements.
1. Can structured settlements be considered as collateral for a loan?
It is not considered a direct form of collateral, but many banks will accept it as a form
of income which will be helpful when making large purchases such as a new home.
2. Wht is a structured insurance settlement?
A structured insurance settlement pays the person who has won the lawsuit settlement over a period of time, instead of just paying the person in one large lump sum.
3. Will I receive interest on money I get from a structured settlement?
The interest that you get from your financial settlement includes any interest that you
would get from the settlement, and that is considered by the IRS tax-free.
If you are involved in a wrongful injury case and will receive a structured settlement,
sit down and ask your attorney informed questions. Make sure that you understand the
answers and are completely satisfied with the choices that are presented to you.
Tips for Insurance Settlements
The primary reason a person carries insurance is to protect themselves from financial loss in case of an accident. Many unforeseen accidents can occur, which could be catastrophic in nature. Your best situation in case this occurs would be to educate yourself about how Insurance Settlements work. Insurance Settlements are structured to account for your loss of wages, future loss of wages while taking in consideration for you future medical needs in relation to the accident.
Remember that the negotiation of insurance settlements should also be done with reputable legal council specializing in settlements.