Structured Settlements - Structured settlements (Viatical) formation

Structured Settlements Formation 

 

Structured Settlements Formation

Structured settlements can be formed in many ways, and their structure is primarily determined by the financial needs of the victim.  The simplest structured settlements are created with an even distribution of cash on a given interim for the term of the agreement.  Such a settlement could include a payment every month for 20 years as an example.

Structured settlements can also be set up in a way that will match anticipated costs as they are predetermined.  If a person will initially require a nurse or home care assistance for a given period of time, a structured settlement can be set up to include heavier payments of the front side.  If assisted living or nursing home services will be required but not for several years, the settlement agreement may be weighted to provide more income later. 

A structured settlement can also be set up to provide periodic larger payments or an extra payment when it is know for instance that every 4 years a new wheelchair or hospital bed will be needed.  Your attorney or structured settlement broker is in the best position for determining what details and requirements should be included.

The important thing about working out your settlement is to have a team on your side who determines what you will need and when you will need it and to be sure to allow adequate room for inflation.  Costs simply go up and they rarely go down.  Building in enough room for inflation is absolutely critical. 

A properly developed structural settlement agreement also includes the time value of money because by design, they do not pay interest.  The interest is calculated in as a part of the payment.  In essence, the structured settlement incorporates a fixed interest rate that is also completely tax-free as it is part of the settlement.

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