What Are Structured Settlements and Structured Annuities?

Structured settlements are an agreement on settlement payments between a plaintiff and a defendant where the plaintiff agrees to the dismissal of the case in exchange for a financial settlement to be paid by the defendant.   Typically, it is the defendant, who wishes to end the litigation of the case,  who makes the initial offer of a structured annuity to the plaintiff.  Both parties will negotiate and the plaintiff will agree to be paid in long-term installments (an annuity) instead of receiving a lump sum of money in a single payment.  

Structured settlements usually stem from tort cases in which a wronged or injured party seeks damages from the offender. Another name for the structured settlement is annuity settlement and the arrangement for financial payments is usually done by purchasing an annuity by the defendant's insurer, as assurance that payments will be made today and in the future. The frequency and number of payments will depend on what the parties negotiate.   They may agree to annual payments for a certain number of years or possibly for an entire lifetime which is common for serious offenses.  

Deciding to sell your structured annuity, either in part or completely, for a lump sum payment can be complex and delicate matter. Laws can vary greatly from state to state with harsh punishment for offenses. Use your head and contact a professional company that has a solid track record and a spotless reputation. Good companies will be registered with the Better Business Bureau (BBB). Do your homework and good luck.