Going through a personal injury lawsuit is not an easy thing, but relief is on the horizon. Read on to learn about personal injury settlement options.
Almost 90-95% of all personal injury cases get settled in pretrial negotiations. If you have a personal injury claim, you’ll go through this negotiation process before the case may go to trial.
During negotiations, you’ll discuss a personal injury settlement. This process and your options vary depending on your specific situation.
Keep reading to learn what to expect with your personal injury settlement.
What Does a Settlement Mean?
A settlement happens when the defense makes an offer of payment to the plaintiff. The plaintiff then accepts that offer and in exchange gives up their right to pursue the case further.
The key to a successful settlement as the plaintiff is to have patience. This is necessary to ensure the defendant doesn’t try to undercut your settlement offer.
The Goal of the Settlement
The goal of the settlement is to make the plaintiff “whole” again. It isn’t there to let the plaintiff profit from the experience. The settlement should cover the plaintiff’s out of pocket expenses that are a direct result of the injury.
Determine Fair Cash Value
Before you can decide on a payment option, you need to think about the fair cash value. This will help you figure out how much money you are talking about.
Speaking with an attorney can help you determine the total minimum settlement you need to be whole. Here are some things that will be included:
- Length of medical treatment
- Total lost income
- Sum of all medical bills
- Long term treatment required
- Any long term diagnosis
- Possible pain and suffering damages
Payment Options
Once you have the settlement total, the next step is to determine payout options. Many people choose to receive structured settlements, which will give you steady payments of tax-free income for years.
These payments are typically made through a life insurance company. The money will be in an annuity.
Another option is a single, one-time payment. This can be a useful option if you have large bills that you need to pay immediately.
How a Structured Settlement Works
There will be a specific start and end date for your payments. Then it will either be life-contingent or term-certain.
A life contingent settlement will only continue as long as the plaintiff is alive. Once they pass away, the payments stop. In rare cases, a spouse may be able to continue receiving payments.
In a term-certain settlement, the payments will continue as long as the original agreement indicates. If the recipient passes away, then their beneficiaries will receive the payments until the end date. This also means that if the plaintiff outlives the end date, they will have to adjust to life without the yearly payments.
You Can’t Change Your Mind
Carefully consider your options and the implications of them in the long run. There is rarely an opportunity to go back and change the agreement.
The only way to access future payments is to sell your future payments. This is called the secondary annuity market.
Carefully Negotiate Your Personal Injury Settlement
When it comes to negotiating a personal injury settlement, it’s all about what works best for you and your family. It’s helpful to listen to attorney’s and their experience.
Carefully consider the impact of a lump sum payment and a structured settlement.
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