How Structured Settlements Work!
A structured settlement is essentially a financial agreement between an insurance company and an individual. Typically, they are used when a person has been injured in an accident, at their workplace, or through medical negligence.
Instead of a lump sum payment, structured settlements provide periodic payments for a fixed amount of time. These payments might consist of equal installments, installments of varying amounts, or an upfront lump sum payment with periodic payments to follow. Structured settlement payments might be paid for a short duration or continue for the remainder of the claimant's life.
People who are entitled to structured settlement payments oftentimes have long-term medical expenses related to the accident. Annuity payments are typically structured to provide the claimant with the means to pay for medical and living expenses; particularly if they are unable to work.
Structured settlement payments are not subject to income tax and are guaranteed by a legally binding contract. Annuity payments are intended for long-term financial security, so it is imperative to make certain the annuity provider is financially sound.
Before accepting a structured settlement it is essential to understand the pros and cons of doing so. It's wise to seek legal counsel prior to signing any documents, but it's particularly important when developing a structured settlement agreement.
One of the biggest advantages of structured settlements is they provide income on a regular basis. They can be structured to provide the claimant with the proper amount of income to cover medical and living expenses.
Another advantage of structured settlements is they are oftentimes settled out of court. Not only does this reduce stress for the claimant, it also reduces costs, which can result in more money being paid to the claimant.
The downside of annuity payments is once the settlement is agreed upon it is nearly impossible to change it. Doing so can alter the tax classification and may result in the claimant being charged with income tax. If structured settlements payments are made to an estate, they are free from income tax, but subject to estate tax. Make certain you understand the tax liabilities before signing off on the structured settlement agreement.
While structured settlements provide a consistent stream of income, there may come a time when you are in need of a lump sum of cash. You might need to buy a new automobile, send your child to college, or have unexpected medical expenses. Perhaps you'd like to have all of your structured settlement money now and not have to wait for years on end.
If so, selling your annuity payments might be the solution for you. Companies such as Simon Volkov purchase structured settlements and provide claimants with a lump sum of cash. Regardless of where you're at in the execution of your annuity payments, if you're in need of cash, we can help.
Simon Volkov is a distinguished leader in structured settlements and has helped hundreds of clients liquidate their cash flow. To learn more about selling your annuity payments for a lump sum of cash, simply fill out the requested information on our secure Structured Settlement form.
There is no fee to consult with Simon Volkov, nor any obligation to sell your structured settlement. However, should you decide selling is in your best interest, we can take care of all the details for you.
Your information will be held in the strictest confidence and we will never share it with others. We look forward to speaking with you and helping you with your financial decisions.
Published on September 04, 2007 at 01:45 PM