While an Automobile Accident Lawyer In Boston MA negotiates a settlement for an injured person, that individual may be presented with the option of receiving the compensation in one lump sum or in installment payments. The multiple payment plan is known as a structured settlement. People generally prefer to receive the full amount of compensation at one time, but there are significant advantages to getting a structured settlement.
A structured settlement typically is paid over several years’ time. It provides a regular stream of income, which is beneficial for someone who can no longer work due to the disabling injury suffered. Another advantage to this arrangement is the person cannot quickly spend the remainder of the settlement he or she receives after medical bills and other accident-related expenses are paid. Unfortunately, many people do not have the self-discipline to effectively manage a large amount of money they suddenly obtain. If the client chooses a structured settlement, the initial payment usually will cover the attorney’s contingency fees, all medical expenses and related expenses, and an amount for the injured person’s own current needs.
An Automobile Accident Lawyer In Boston MA can provide insight into the advantages and disadvantages of both these payment arrangements, and can address any concerns the client may have. For instance, the client may wonder what happens if the settlement provider declares bankruptcy in the future. Do monthly payments stop then? Typically, the payments are made through an insurance annuity, and insurance companies are not allowed to declare bankruptcy. If the insurer ever does shut down due to lack of finances, a guaranty association continues to make the payments. This is similar to the way that bank accounts are protected from bank insolvency.
An insurer also may be more likely to agree to greater compensation paid through a structured settlement than in a lump sum. An attorney with a firm such as The Law Offices of Burton J. Hass may be asking for more compensation than the insurer is willing to immediately provide, but the company may be willing to negotiate if it is allowed to provide monthly payments over time.
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