Large Funding Structured Settlements

A large structured settlement is a court appointed required payment in small increments over a predetermined period of time after the plaintiff settles in a law suit. For example, suppose a man was in a car accident. A truck driver ran a red light and the man was seriously injured so he decides to sue the trucking company's insurance company for the hospital bills as well as the income he lost being out of work with injuries. The trucking company settles with the man, and they agree on the sum of $150,000. The insurance company doesn't have $150,000 to just pay the man outright, so insurance company requests that the payment be structured. The court approves the payment extensions and the parties agree on paying the man $2500 per month for the next five years. Thus, funding structured settlements are far easier and more economical to do. Instead of having to come up with $150,000 right away, the insurance company only has to deplete its funds of $2500 a month. There are many benefits for both parties involved. One may be wondering if this type of payment arrangement is right for their case. By exploring all options, each person can make a wise decision.

One benefit is that the terms can be negotiated. The money can be paid over any amount of time as long as both parties can come to an agreement. Funding structured settlements can vary from months to decades, depending on the amount of money and the circumstances. This works to the benefit of both the plaintiff and defendant in the case. The defendant has extra time and less pressure to borrow to pay. The plaintiff receives the money in manageable amounts. Many people tend to lose control of large sums of money. With a large structured settlement, the plaintiff receives small amounts so the money doesn't all disappear at once. People have the tendency to spend more when they have more so money is depleted much more quickly when paid in a lump sum compared to payment over a period of time. This is especially true for cases involving college-age or younger plaintiffs. Young people usually don't have the financial responsibility and experience to handle large amounts of money responsibly. Thus enabling more money will be available for future expenses such as college courses and emergency or unforeseen medical complications.

This type of payment distribution also has tax benefits. Usually, when obtaining a large structured settlement , whether it be through a contest, lottery or law suit, the money is taxed up front. With a large structured settlement, tax payments are reduced or even sometimes completely non-existent. Most often, though, one can expect to pay some amount of taxes. Despite this possible tax-free benefit, there are a few disadvantages. People who want to invest large sums of money from their payments won't be able to do so under funding structured settlements. These investments tend to have a greater return than smaller investments made with smaller payments. Also, major purchases, such as the purchase of a home or car, will still require a loan rather than the large upfront payment that would be possible under a lump sum amount.

Before getting involved as a plaintiff or defendant, there are some factors to consider and think about. First of all, consult a lawyer or a financial consultant. They will be able to help decide what settlement plan is best for each unique situation. The lawyer may make a referral to a financial counselor in deciding payment. Knowing the attorney's intentions will also help. Some attorneys receive kickbacks for enrollment from certain firms and agencies that hold the annuity where the payments will come from. Make sure the lawyer isn't also working for the insurance company. This can be a conflict of interests. Watch out for excessive commissions being charge by the insurance company as part of funding structured settlements.

A serious factor to consider when choosing is the life expectancy of the injured party. A ten-year term might be good for the defendant, but the plaintiff may not expect to live ten years with the injuries they have. Also, it may be a good idea to work with multiple insurance companies should the plaintiff be at fault. This is good preparation should one of the insurance companies fail to pay their part of the large structured settlement or go bankrupt. Overall, it is important to trust God in each situation. If one really is at fault, take responsibility for all pertaining actions. If one really is the victim, don't be afraid to stand up and seek compensation for the resulting suffering. "Offer the sacrifices of righteousness, and put your trust in the LORD" (Psalm 4:50). As with any decision involving money, it is important to think carefully about accepting any large structured settlements. No matter what side one is on, it is important that each trust those who are on their side. There needs to be an attorney or insurance company that can be relied on.

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