We do everything in our power to get our clients the biggest payday possible, and sometimes the best way to ensure an award and maximize a payment is through a settlement agreement. Settlements are an agreement between you and the other party’s insurance company that both sides agree on. From an injured party’s perspective, settlements are nice because they guarantee a certain award amount and take away the possibility of losing at trial. From an insurer’s perspective, a settlement allows them to resolve an outstanding claim on agreeable terms, meaning they often don’t have to admit fault in return for a payout. Settlements also help them avoid the potential of an even larger payout if they lose their case in court.
When it comes to a settlement agreement, there are a number of different types that may be in play. In today’s blog, we take a closer look at the types of potential settlement agreements after a personal or work injury.
Types of Injury Settlement Offers
Here’s a look at a number of different types of structured settlements that may be available for your case. Your lawyer can go into further detail about the benefits and potential drawbacks of each.
Decreasing Settlement – You may be able to get a larger amount of money at the beginning of your settlement, followed by smaller payments over time. For example, if you received a $200,000 settlement, you could ask for $50,000 up front and $1,000 a week for the next 100 weeks and $500 for the next 100 weeks after that. Some people choose a decreasing settlement if they expect their condition to continue to heal, as they will likely have fewer medical bills in the future.
Increasing Settlement – On the flip side, if you believe you’ll have more medical bills in the future due to expected issues with your injury, you can choose to have a settlement that pays you an increasing amount over time.
Lump Sum – With a lump sum settlement, you get full payment all at once. Although this may be considered a structured settlement, there isn’t much structure to it since there’s only one payment. Talk to your lawyer about the tax implications of a lump sum settlement.
Lump And Some – There isn’t really an official term for this type of settlement, but it can best be described as a “lump and some” payment. The lump comes from a larger lump sum at outset (oftentimes to cover medical bills and other major expenses) followed by smaller amounts paid at regular intervals going forward (often to help offset lost wages). If you earned a $100,000 settlement, you might get half right away and $500 for the next 100 weeks. You can negotiate the terms of your lump and some settlement.
Delayed Settlement – If you’re not hurting for cash, some people opt to take a delayed settlement offer. This means the insurance company won’t make payments until a certain date, like when you reach a certain age or until after you retire. This can help provide a source of income after certain milestones.
At the end of the day, these are just a few of the more common types of settlements, but you can help design your own with the help of a lawyer (assuming the insurance company accepts your offer). And as we mentioned above, although workers’ compensation payments aren’t typically taxable, you’ll want to talk to your tax professional or your lawyer about any tax implications associated with a proposed agreement.
If you are wondering if your injury claim may be eligible for compensation or a settlement award, reach out to Dean Margolis and the team at Margolis Law Firm today. We’ve negotiated numerous structured settlements in the past, and we can do the same for you if it’s in your best interests. To learn about your options and move forward with a case, contact Margolis Law Firm today.
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