Structured Settlement Annuity
What Does Structured Settlement Annuity Mean?
A structured settlement annuity is a method for someone who wins a legal settlement to receive their payout. Instead of receiving the entire amount as a lump sum, the plaintiff places the money in an annuity, which is a type of financial contract. The annuity not only invests the settlement, allowing it to grow over time but also provides the plaintiff with regular payments according to a set schedule.
Insuranceopedia Explains Structured Settlement Annuity
You may receive a structured settlement annuity as part of the court decision. In this case, if you need a lump sum, you can sell the annuity to a settlement company, a financial or insurance company that specializes in managing these types of investments. Conversely, if you receive a lump sum, you can use it to purchase a structured settlement annuity. This can be a helpful way to budget the money and is a wise choice for anyone who has difficulty managing large sums, especially if they are financially dependent on the settlement.
