Structural settlement has always been a traditional way to settle all the cases. Firstly, the structured settlement saves the tax money you pay. While the money that you receive in a personal injury settlement is usually not taxable, you do have to pay taxes on the interest and dividends that you receive on the settlement money after you invest it. While in a structural settlement you are the owner of all the money as the defendant pays you a cheque and you get it cashed directly. The money remains with you so you don’t have to pay any taxes at all.
Advantages of A Structured Settlement
Secondly, when the defendant sends you a check, you just cash the check out, and the case is over from your side. One should take a lump sum settlement for all the small settlements to be made and most medium- sized settlements less than rupees seventy five lakhs or so. But trying to settle a larger case, there are two good reasons for doing a structured settlement. Firstly, the structure guarantees that you won’t spend the money too fast. In most of the injury cases settlements, it is seen that the individual blows out the entire sum in a very short period of time astoundingly and then after a short period of time becomes penny less having nothing to spend on him.
Another advantage of a settlement with a lump sum is that you can get the money at any instant of time when you need to pay off the bills from the settlement being the most casual and crucial reason to get all of the capital upfront, being the main advantage in lump sum settlement.
If an individual plans to buy a new house or a commodity like a brand new car with the settlement money, then he needs the money at an instant of time, and if the settlement is not that much large, the individual simply does not gets any advantage from a structural settlement.
If you undergo a car accident or another motor vehicle, for say rupees fourty five lakh and the insurance settler asks you to go for a structural settlement, you should refuse him completely and you should simply tell him that you need the capital as a lump sum of settlement, that will be paid after signing the release and the other documents of the settlement.