Should You Request a Lump Sum or Structured Settlement from the Insurance Company?
Most personal injury claims settle via a lump sum payment. That means the injured victim gets a check from either the at-fault party’s insurance provider or their own insurance provider and that’s the end of the process. But victims can also request structured settlements, which means they get their payments spread out over several years.
Which is right for you? There are pros and cons to each type of settlement.
Pros of a lump sum:
- You get all the money right away. You don’t have to wait, and you can begin paying your medical bills and everyday living expenses.
- You can put the accident behind you. Receiving a lump sum payment signals the end of your claim.
- You can invest surplus money to receive a greater return.
Cons of a lump sum:
- Handling a windfall can be difficult. Many people struggle to manage a large amount of cash.
- If you mismanage the money, it’s gone. There will be no more checks coming to you.
- You may owe a greater tax burden.
Pros of a structured settlement:
- You can count on regular payments to continue for a long time. That means that even if you mismanage your first few checks, more are coming.
- You can save money on taxes.
Cons of a structured settlement:
- You lose out on some money due to inflation.
- You lose out on the chance to invest excess money.
The Roanoke personal injury lawyers at Skolrood Law Firm can help you decide whether a lump sum or structured settlement is right for you. Contact us today for a free consultation, and let us build your claim.