Personal Injury Settlements: 3 Things To Discuss With An Attorney When Looking At A Structured Settlement

When filing a personal injury claim, your attorney will normally recommend that you consider settling with the other party instead of taking the case to court. You might not get as great of a deal or as large of a compensation if you are to take the case to court, and you might also be charged a higher contingency fee rate for the extra amount of hours that the attorney will need to put in. Once both parties agrees to a reasonable compensation amount, a structured settlement is an option that is commonly explored if the compensation amount tends to be rather large. Here are 3 things that you'll want to discuss with your attorney when it comes to structured settlements.

Terms Related to Whether Payments will Continue in the Event of Death

Structured settlements are designed so that the entirety of the compensation will be paid out through a set period of time. However, depending on how the contract is written, the payments may be made only to you. This means that the payments may stop prematurely in the event of a death. This is usually the case in the event that the responsible party agrees to pay you a certain amount indefinitely until your death.

If a final amount has been agreed upon ahead of time, your attorney might recommend that you designate a beneficiary. In the event that you pass away before the entire sum has been paid out, your beneficiary will continue to receive the payments. In most cases, most people tend to designate their spouse, children or a close family member or friend as the beneficiary; however, you can also request that the payments be made to a charity of your choice if you happen to be more of a philanthropist.

Conditions for Increase of Payment Based on Inflation

The value of a dollar will rise with time. Things were not as costly in the past, as they are now. The cost of living has risen significantly and you can expect this trend to continue in the future. If the payment term for the structured settlement is relatively long, your attorney might want to explore investment options with you or might want to discuss inflation rates with the opposing party.

Your attorney might come to an agreement that the payments will increase to account for inflation. The increase might rise with the annual inflation rate or might increase by a specified percentage regardless of how much inflation has affected cost of living.

Clauses in Place that Allow You to Receive a Lump Sum if Needed

A structured settlement is usually put in place to help guarantee that the compensation awarded will last you for some time. Some people tend to live more lavishly and extravagantly once they've received their compensation. They are quick to spend all of their money, and will often find themselves in a difficult position once the money is gone. This is especially true for those who will need the money to pay for future medical treatments. While this is the case, emergencies and unexpected events do tend to come up. You might find yourself needing emergency medical treatment or you might find yourself in a tough spot financially.

In these situations, you'll want to be able to dip into your settlement. Confirm that your personal injury attorney has set up appropriate clauses in place that will allow you to request for and receive a lump sum of money whenever you need it. The procedures on how to file a request for the extra funds should be written in a clear and concise manner. It's also important to figure out whether any conditions need to be met for your request to be approved.


A structured settlement can provide many benefits, including the fact that they are income-tax-free, as it makes sures that you won't spend your money all at once. With that said, you still should go through the various terms and conditions and clauses with your attorney to confirm that you understand what you're agreeing to. There should be clauses put in place that can protect your interests.