Long-term Payment Plans for Personal Injury Claims
A majority of personal injury claim often choose to have out-of-court settlement for a number of reasons. Settling out-of-court can save both parties from unnecessary expenses and valuable time that long court proceedings often demand. When negotiation occurs for injury claims, it is often understood that the payment would be given in a lump sum. What not many people know is that payment for the compensation can also come in long-term payment plans. Rather than a lump sum payment, some plaintiffs choose to have a structured payment plan that can span over a certain period of time.
Structured payments are a settlement payment plan that both the claimant and the defendant has agreed upon. Some of the settlement will be given in a lump sum, while the rest of the compensation will be a structured payment over an agreed amount of time. When both parties have agreed to the terms of the structured payment, the defendant (or their insurance company) will be responsible of transferring parts of the structured settlement to a separate insurer, typically a life insurance company who practices structured settlement payments.
A number of things can be negotiated and included in a structured settlement, such as the amount of payment to be received and the schedule of payment, the length of the payment plan, whether the lump sum is given at the end or if the payments will end after death or handed over to next of kin. These, and many other factors, can be arranged between the plaintiff and defendant, but it is important for the plaintiff to ensure that the company that will provide the payment is reputable and highly rated. This minimizes the risk of the company going bankrupt or fail, prompting the structured payments to stop. Just as with any negotiation and settlement, there are risks involved when choosing structured payment. Talking with a personal injury lawyer about the possibility of structured payment can help in lowering these risks and work out the best payment plan for the case.