Structured Settlement Brokers
Structured settlement brokers facilitate negotiations for the development of annuity payments to individuals who have been injured. Structured settlements are often used to payout large financial awards over an extended period of time. In addition to injury compensation, structured settlements are also used to payout lottery jackpot winnings.
Structured settlement brokers advise lawyers about the various annuity plans available to clients and assist in the sale of future annuity payments. Brokers provide required information for settlement offers; answer questions regarding offers; and assist in negotiating the best deal for attorney's clients.
Although each structured settlement will be unique to clients' needs, the primary goal is the address current and future financial requirements of the injured party. Monetary compensation is based on a variety of factors including anticipated economic conditions and Annuitants' life expectancy.
Structured settlements include funds for legal fees, medical expenses, future medical care costs, and living expenses. Depending on the circumstances, structured settlements may also include compensation to cover anticipated expenses once Annuitants reach retirement age, or funds to cover educational costs for Annuitants' dependents.
In order to devise annuity payment plans, structured settlement brokers must assess information about Annuitants' lifestyle and personal finances. Brokers review Annuitants' medical claim, credit history, and employment history to ensure life care plans provide adequate compensation for future medical and living expenses.
Annuity payments are guaranteed through life insurance providers. Insurance companies base premiums on the level of risk. Three ratings are used in the insurance industry and include: Preferred, Standard, and Substandard. Individuals with a substandard rating are often declined coverage. However, with annuity payments, a substandard rating may provide a better rate of return.
The first step of developing structured settlements involves determining if Annuitants qualify for a substandard rating. Multiple factors are involved when determining life expectancies. These include: consumption of alcohol and tobacco, diabetes, heart disease, obesity, cancer, and other chronic health issues.
Structured settlement brokers have access to multiple life insurance companies and can comparison shop to obtain the best annuity plan. If required, brokers can mediate negotiations with Medicare and Supplemental Security Income (SSI) to ensure Annuitants do not lose their benefits. Brokers can also offer financial and tax planning advice to Annuitants.
When annuity payments are provided as compensation for injury, funds are exempt from state and federal taxation. If future annuities are transferred to an estate they will be subjected to estate tax. Annuities provided as compensation for lottery winnings are subject to taxation at state and federal levels.
Structured settlements can be arranged to suit financial needs of the Annuitant. Annuity payments can be established to provide funds on a monthly, semi-annual, or annual basis. Installments can be equal payments or varying amounts.
Structured settlements offer considerable flexibility during development. However, once in place, settlements cannot be altered. Some states allow Annuitants to sell future annuities in exchange for lump sum cash.
A structured settlement broker can assist with the sale of future payments. When selling structured settlements it is crucial to work with brokers who are registered with the Department of Justice and insured against errors and omissions.
It's important to gather the facts about structured settlements to ensure adequate injury compensation is provided. We invite you to learn more about how structured settlements work and how to locate professional structured settlement brokers in our annuities and structured settlement article library.
Published on January 22, 2011 at 02:52 AM