Are you avoiding suing for your injuries because you don’t want to deal with the process of going to court? Lucky for you, the number of civil cases that settle before going to trial is high.
Some estimate the percentage to be as high as 95% or more. Instead of having your day in court, you might get compensated through a structured settlement.
How do structured settlements work exactly? Keep reading to find out.
How Do Structured Settlements Work?
Sometimes a civil case is settled through a structured settlement. These cases involve the plaintiff, aka the person who was wronged, and the defendant. The defendant is usually a company who caused harm but might also be an individual.
The structured settlement agreement process starts when the plaintiff sues the defendant to seek compensation for an illness, injury, or death that the defendant caused.
A defendant can agree to give money through a structured settlement to avoid going to court. If the case ends up in trial, the defendant might be forced to set up a settlement if they lose the case.
Once there is a verdict, the defendant and plaintiff work to determine the terms of the structured settlement by using a qualified assignee. The agreement will determine the following:
- How much regular payments should be
- How long regular payments should continue for
- If payments should increase at certain times
So, how does a structured settlement work with an insurance company? The qualified assignee will purchase an annuity from a life insurance company to match the settlement needs.
The insurance company will pay the plaintiff a series of payments according to the annuity contract. Once these terms are set, they cannot be changed.
This means that the only way to receive payments ahead of schedule is by selling the structured settlement.
Should I Sell My Structured Settlement?
“I have a structured settlement but don’t know if I should sell it for cash.”
This is a common thought for those who have a structured settlement but need quick cash. The idea of getting cash for a structured settlement is beneficial in some circumstances.
If you are having an emergency crisis that requires funds, getting cash for your structured settlement might not be a bad idea. However, if you just need spending money, you’ll be better off keeping your contract.
You won’t get the full price of your structured settlement if you decide to sell it, but you can sell a portion instead of giving up all of your payments. You’ll have to follow steps, including a court approval process, to receive a payout.
Learn about Rightway Funding and their structured settlement offers to decide if selling is right for you.
What to Expect From a Structured Settlement
So, how do structured settlements work? As the plaintiff, you can sue for injury, illness, and death to receive compensation. If the defendant wants to avoid court, they can work with you on a structured settlement agreement.
Unless you choose to sell your structured settlement, you’ll receive regular payments over time. Rather than one lump sum of cash, you’ll be provided with financial security to pay for injuries and damages.
For more informative articles like this, check out the other posts on our blog.