Advantages Of A Structured Settlement In Settlement Funding

The preferred mode of payment in settlement funding could be structured settlement, as this is paid regularly in amounts over a period of time for the convenience of the payee. This is beneficial to senior citizens as this affords them money whenever they need it.

If the total amount from the settlement funding is invested, the payee is also insulated from instances of poor financial planning, as he gets a steady flow of income to sustain him for a long time.

It is more beneficial, especially if the payee is unable to work for the rest of his life; he can just receive payment in monthly checks.

Structured settlements are generally suitable for the following cases:

1. The settlement funding has been awarded to someone who has been severely injured. The payee will need the money for the treatment, which could last a long time. The structured settlements will also help sustain the injured victim's family.

2. Compensation is being awarded to a worker, where an injury prevents the worker from working full time. The injury reduces the worker's capacity for work, causing a reduction in the monthly income. The structured settlement provides the additional income to meet the family's needs.

3. When the settlement funding is awarded to an injured person who has sustained a permanent or partial disability. He is greatly benefited by a small but assured monthly payment.

4. In cases of settlement funding being awarded for wrongful death, where the surviving members of the person's family will be assured a monthly sum of money replacing the income of the deceased.

5. Settlement to a person who is mentally incapacitated, or to a child. In this case, the fixed amount from the settlement can be used to cover medical expenses of the affected worker, and for general expenses, as in the support of a child.

If the situation is any of the above, additionally the following factors should also be considered:

1. The duration for which the payee is expected to bear medical expenses including provisions for future increase in expenses, due to additional care requirements.

2. Miscellaneous medical expenses and expenses for care facilities.

3. Expenses for education of the children, retirement, and daily household expenses

4. Expenses for rentals, paying off debts like a mortgage, and any other expenses that may not have been taken into account.

The settlement funding should be structured, as a rule, to suit the payee's unique situation, and designed to be distributed over the lifetime of the payee, with things like inflation of money, factored into it, thus ensuring that the amount increases yearly based on the increase in cost of living.