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| Settlements Explained |
Structured Insurance SettlementsOr are you bothered by a complaint against your insurance company? If you are, you can opt to have a structured insurance settlement.
Structured insurance settlements are alternative plans for the money the insured persons’ immediate families will receive when they pass on.
Structured settlements are arrangements that include periodic payments as a great alternative to the lump sum settlements that you will receive if you promise to drop or release the lawsuit against the firm.
It might be a bit confusing, so let us put it this way. With regards to theStructured Insurance Settlement first issue, any client who wishes to have a better management of money for his family, the structured insurance settlement will help him have monthly or periodic installments to his family with a tempting large amount of money left in the bank. Truly, it is a better idea, instead of receiving a lump sum of money that could be spent in no time.
The second case too is a better approach on the part of the client like you. When you file for a tort suit against your insurer, you could choose to have a series of periodic payments over time. That just means that the insurer will find itself having a long-term financial obligation to you.
But of course, the insurance carrier could not just work that way. So when this happens, it could either have a “buy and hold” arrangement, or have the “assigned case.”
Structured SettlementsThe first kind of arrangement allows the company to purchase an annuity from Life Insurance Company and names you, the claimant as the payee so that the insurance company will direct the payment straight to you.
The second type is somewhat similar to the first one, but it needs another company that will be assigned to buy an annuity to fund your insurance company’s periodic obligation and thereby frees it from its liability of paying you. It’s a complicated tactic but it works for all parties.
Regardless of the processes being done by your insurance company, the structured insurance payments are still pointed to your benefit as a client.
So if you are still thinking about the same issues again, bear in mind that it’s what insurance companies are here for: to keep you from worrying a lot about your and your family’s finances.
Payment Arrangements For Structured Insurance Settlements
When we talk of structured settlements, it’s about payment arrangements (periodic payments, for instance) made by insurance companies that have been sued with tort by their clients.
Structured insurance settlements, on the other hand, are alternative plans for the money the insured persons’ immediate families will receive when they pass on.
It’s pretty obvious that most companies, especially the insurance firms, are careful not to be sued. But if they are, this is what they resort to: they arrange some payment for the complainant in exchange of the dismissal of the case he or she has filed against them.
This type of payment is done in a series of periodic payments (monthly, for instance), depending on the convenience of the claimant. So the insurer is now left with a long-term payment obligation, but the good thing is, it is freed from the lawsuit.
To make a clear picture of the structured settlement, let us discuss it this way. It was first utilized as an alternative to lump sum settlements. But now, several countries, including Canada, England, Australia, and United States, already have it as part of their statutory tort laws.
As the term implies, this settles the payment in a structured way which is usually periodic, in accordance to the agreement or judgment made about the case.
In order to meet this type of payment arrangement, the insurance company may seek assistance by purchasing an annuity from a life insurance company.
This annuity is owned by the insurance company but it is named under the client’s name. Life insurance would then direct the payment to the client being the official payee. This arrangement is called the “buy and hold” case.
The insurance company can also have an arrangement where it pays another company (third party) to buy an annuity from a life insurance company under the name of the client.
This form, which is also known as the “assigned case,” is applicable to companies that don’t want to have further liability of having periodic payments to their clients.
The bottom line is – the structured settlement is an advantage for both parties. No extra costs for the attorney fees and no stressful lawsuits.
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