What is structured settlement?

This is a term generally used in insurance settlement. Insurance settlements are normally one time settlements given to the affected party or the claimant. The structured Annuity settlement (also called as ‘Structured settlement’) can be called as an extension of the benefits over a longer period of time. In other words, the victim gets a fixed amount periodically instead of getting the money in one lump sum. Such periodical income would normally last till he fully recovers and is able to take up his normal work.

Legal aspect:
It is said that the concept of structured settlement was first practiced in Canada in 1970. Later several other countries resorted to this procedure. Considering the advantage of this form of payment of compensation to the accident victims, several countries passed laws to legalize the Structured Annuity Settlement. This type of structured settlement is also called as ‘periodic payment judgment’. The Annuity is decided depending on the nature of injury, time normally taken to fully recover, type of immobility of the victim, the status of the victim, etc.

Structured Annuity settlement Vs one time settlement:
In one time settlement, the victim has to suit his budget to the compensation received. This is particularly difficult when the victim is immobilized for longer duration of time. The victim will have to manage the medical expenses, domestic expenses, etc. within the compensation received and there is likelihood of the funds depleting. Instead, under the Structured Annuity settlement, the victim gets the compensation for a longer duration. He is assured of some periodical income till he recovers. With this amount, the victim can maintain his family, pay children’s school fees, the expenses towards food, medical expenses, etc. As a result, the victim’s daily life is not affected. Now this type of settlement is becoming more and more popular.

How to claim structured Annuity settlement?
There are several financial agencies and attorneys who are specialized in such cases. They will guide the claimant about the procedure to be followed in claiming the amount. Of course, they will charge a small amount as their consultation fee.
Brian Sibet also writes about Retirement Planning and Annuities including Lump Sum Annuity and Sell Structured Insurance Settlement

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