Structured settlements are generally known as the replacement for the conventional lump sum cash settlement. In brief, a structured settlement is a contracted arrangement where the insurance company agrees to pay a predetermined periodic payment to the claimant. Most of the time, such payment is used to resolve personal injury tort claims or to compromise a statutory periodic payment obligation.
Structured settlement system was first introduced in Canada back in 1970s, followed by United States in the early 80s and then to the European countries. As the system is recommended by the Federals, structured settlement is a popular alternative to the lump sum cash settlement in United States.
3 Advantages of structured settlement system -
Tax advantage
Avoid dissipation risks
Flexibility
