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What is a structured settlement?

August 21, 2009

Texas personal injury lawsuits are often settled without going to trial, and sometimes these cases are settled for a large sum of money. Many people might assume that the next step is for the defendant to write the plaintiff a check for the amount of the settlement and then it’s case closed.

However, it is not always possible, or beneficial, for a settlement to be paid out as a lump sum. Instead, the parties can choose to arrange for the settlement to be paid as a series of smaller installment payments over a set number of years. This is known as a structured settlement.

The parties to the lawsuit have a great deal of freedom and flexibility in how they choose to structure the settlement. They can decide for themselves how big each payment will be and how often the payments will be made.

A structured settlement can be a very beneficial arrangement for all parties involved. For example, if set up a certain way, a structured settlement can greatly reduce the amount of taxes the plaintiff owes on their settlement. In some cases, the payments are tax-free.

There are other reasons why a structured settlement might be the best choice for the plaintiff in a Texas personal injury lawsuit. A guaranteed, long-term source of income is one important benefit. If your injuries, for instance, require ongoing medical care, a structured settlement will ensure that there is a steady flow of money coming in to cover your expenses.

An experienced Texas personal injury lawyer can advise you on whether a structured settlement is the best option for your circumstances. In fact, you should always speak with an attorney before accepting any settlement offer to be certain that you are receiving full and fair compensation for your injuries.

To receive free legal advice from a Texas personal injury lawyer, contact Fears Nachawati today. You can email us at or call us on our toll-free number at 1.866.705.7584.


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