Benefits of Structured Settlements to Defendants

Submitted by Abbey Hudson on Sat, 10/08/2016 - 01:14

Structured settlements can be utilized as part of a comprehensive settlement plan for claimants that have suffered a physical injury or illness. Structured settlements provide income tax-free, guaranteed benefits that help secure the financial future for injury victims and their families.

The federal government encourages claimants to utilize structured settlements by providing favorable tax treatment, and the value of guaranteed income and payments over the long term is invaluable to many claimants. This is especially true for those suffering from catastrophic injuries or that need to plan for future medical and living expenses.

The benefit to claimants cannot be understated. However, there are also benefits to defendants that choose to utilize structured settlements through the case resolution process.

  • Structured settlements can be a useful tool in resolving claims without the time, expense and risk of taking a case to court.
  • The settlement negotiation process can be difficult for all parties involved. Focusing on the specific future needs of the claimant, and offering a solution to meet those needs, can help the mediation go more smoothly.
  • Structured settlements allow the claimant to receive payments into the future, and the defendant is able to assign its obligation to make the payments to a qualified assignment company which is typically affiliated with a large, well established life insurance company. This assignment removes the defendant from the burden of having to own the contract or maintain obligation for future payments being made.
  • In the structured settlement process, the defendant will send the settlement premium directly to the life company that has been chosen by the parties, and the life company will pay the claimant as payments are due. Defendants can then count the settlement as paid on their books, and there is no future obligation to make any additional payments.
  • Structured settlements can be highly beneficial to injured claimants, and defendants have the opportunity to participate in a process that helps provide a secure, guaranteed future financial benefit for injury victims and their families.

Structured settlements are a tool that can be utilized by all parties to help overcome obstacles in the settlement process and to help both defendants and plaintiffs find a resolution that has benefits for everyone involved. To find more resources on the benefits of structured settlements, visit