The Advantages of Structured Settlements

Structured settlements are an important part of settlement planning. When your client is awarded financial compensation as a result of a workplace injury or damages, you want to ensure that the funds from their settlement will be available when they need them. When working with a skilled settlement planner, structured settlements can be utilized to balance your client’s expectations and goals with an effective payment plan that considers their best interests. Your client might want to cash out in one fell swoop, but we recommend hiring an experienced settlement planner to chart their course to a successful financial future using a structured settlement.

Consider the Future

Structured settlement annuities can be customized to your liking. For example, you can design this settlement to consider your future expenses and income to keep your finances balanced. Depending on your client’s preference and the advice of a settlement planner, a structured settlement can be paid monthly, annually, semi-annually, in a sequence of lump sums, deferred up to 20 years before starting, or even spread out in payments for the rest of the claimant’s life.

Save on Taxes

When you utilize structured settlement annuities to make a claim against an employer or another responsible party, the principal and interest earned on the settlement is tax exempt (IRC 104(a)(2)). On the other hand, if you opt into a structured settlement as a result of a case involving taxable damages, your settlement will not be tax exempt, but it will be tax deferred which can lead to considerable tax savings.

Guarantee a Suitable Rate of Return

Structured settlement annuities are fixed annuities, meaning they pay the precise amount established when the annuity quote was first presented in the annuity contract. Unlike variable annuities, fixed annuities guarantee a consistent rate of return which protects the claimant from stock market fluctuations and the potential to lose value on their settlement. Today, structured settlement annuities are offered and guaranteed by many of the life insurance industry’s most notable companies.

Benefit from Medical Underwriting

Structured settlement recipients can benefit from lifetime payments if they work with a medical underwriter to review their medical history. Medical underwriters review your client’s medical history and allocate a “rated age.” This age will be considered in lieu of the claimant’s biological age, which often leads to higher payouts. If your client has suffered a serious injury, working with a medical underwriter to establish their rated age can significantly increase the value of the payments being issued to your client.

Structured settlements can help improve the outcome of your client’s personal injury or taxable damages claim. If you would like to learn more about our settlement planning services, including structured settlement annuities, contact Synergy Settlement Services.

For more information or to schedule a consultation, please submit our contact request form.

Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.

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“Synergy is our guiding light for deferring our contingent legal fees and planning for retirement. The lawyers at Panter Panter & Sampedro, myself included, have been working with them for over ten years using different methods to defer comp and plan for retirement.”

Brett Panter
Panter, Panter & Sampedro

"I don't think I've directly said "thank you" for helping us with Bridgett’s case. We sent the reduced payment to Medicaid and called Bridgett's mom to tell her approximately how much money was going to be left for Bridgett and she broke down over the telephone. Given only $25k of insurance and a $850k medical bill from the hospital she didn't think Bridgett would ever see a penny."

Tom L. Copeland
Jeffrey Meldon & Associates, P.A.

Understanding Structured Settlements and Medicare Set-AsidesThird Thursday Webinar Series

The parties agree that a Medicare Set-Aside is needed, now what? In this month's webinar, presented by Synergy CEO, Jason D. Lazarus, you will learn about the process basics for setting up a set aside including MSA allocations, funding mechanisms for set-asides, post-settlement administration as well as an overview of the process to make sure you close the case compliantly.

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