Personal Injury Insurance Settlements

Written by Jacey Harmon
Bookmark and Share

Many times a person is forced to sue an insurance company due to an injury from an accident or negligence of some sort. Many times a settlement is reached before the lawsuit ever goes to court. In most cases, the settlement is designed to meet the needs of the plaintiff. In order to choose the best payout, it is necessary to know something about the components of a structured settlement.

Basic Components of a Structured Settlement

When a person gets injured, there are often mountains of medical bills that need to be paid. Structured settlements will often allow for an initial lump sum of money to be paid that is intended to cover the resulting medical expenses. In addition, if the injury has lasting effects, there may be a special medical annuity set up. This annuity is intended to fund expected medical expenses as a result of the injury.

Initial lump sums may be offered for loss of income from the injury. The settlement may also include an income annuity. This annuity is used to replace lost income from a result of the injury. A person that can no longer work at his or her previous profession is likely to receive an income annuity in a settlement.

Special accounts may be set up that can serve a variety of purposes. There may be an account that provides payments that are available for use any way the payee sees fit. This account can fund purchasing a home, automobiles or even fund vacations. Education accounts may be set up to help pay for the costs of education for children.

Bookmark and Share