By Katrin Freeh on September 17 2018 14:14:04
If you have been hurt in an accident, chances are you have hired an attorney to pursue your claim for compensation for your injuries, pain and suffering. This is a fairly common occurrence for those who have been put through the harrowing ordeal of having to endure an accident for which they were not at fault. For many years when a settlement was awarded to the victim, the amount of money that was awarded would go to the victim in the form of a lump sum. However, this is generally not the case anymore. Nowadays the more common manner of paying money to the injured party is in the form of a structured settlement.
Without a structured settlement, many victims had to rely on a third party. In a lot of cases, the money ran out quickly. This is for several reasons. The victim may have had poor spending habits. Faced with a large sum of money, they were not thinking about the future but instead were thinking of fun ways to spend a lot of money they never had before. Not long after that, they find the money is gone and they still have to live their life.
Structured settlements can be sold when there is a monetary emergency. There is an option of selling the settlement in parts, instead of opting to sell the whole settlement for a lump sum. The whole settlement needs to be sold only in case of dire emergency when the cash has to be raised immediately. Structured settlements can be sold as portions when money is required in smaller quantities and does not require the lump sum that would be available if the whole of the structured settlement is sold.
In the simplest of terms, a structured settlement is a payment to the injured party made in regular installments over a period of time. This is different than getting a cash award in a lump sum up front. For example, if a person was in an accident and it was ruled that the other party was at fault, the other party may have to pay damages. If the amount was one million dollars, instead of a check being cut for one million dollars, it would be paid out in monthly installments over a period of a few years. For instance, a one million dollar settlement paid out monthly over ten years would mean a check paid to the inured party in an amount a little over eight thousand dollars per month. A structured settlement can vary as to how it is paid out. Some forms of structured settlement are paid out monthly and others annually.