Use of loans for structured settlements
The usage of loans for structured settlements was once regarded as too dangerous, due to unclear financial consequences for both claimants (the people claiming regular payments) and insurers. However, use of loans for structured settlements changed when the United States Congress passed tax laws in the early 1980s to encourage more people to use structured settlements as a means of settling legal dispute, such as the Periodic Payment Act which produced IRS Section 30, allowing third parties to handle the regular payment of claims in legal disputes.
Eventually, both Congress and the IRS created more regulations to supervise loans for structured settlements, and engaged in research to bring data on their viability to public awareness. The structured settlement industry, due to its tax,free benefits, eventually went on to see a huge amount of growth, especially in recent years.
Where do loans for structured settlements come in?
Loans for structured settlements are most commonly seen in cases of bodily injury claims where the victim – in this case, the plaintiff suffers serious injury or death as a result of the defendant’s actions, whether direct or indirect. In more serious, nonfatal cases, annual payments usually last for the rest of the plaintiff’s life.
Loans for structured settlements and payments:
These lifetime loans for structured settlements are, in particular, common in cases of catastrophic injury, where the victim suffers a serious, permanently disabling injury (i.e. to the brain, skull, spine and / or spinal cord.) An example of loans for structured settlements would be suing a drunk driver after crashing into your car and leaving you in a wheelchair, or an industrial company which pumped toxic chemicals into a river near your house, resulting in serious illness or death to you and / or your family.
In cases of death as a result of the incident, however – such as wrongful death in the workplace – the surviving family of the victim instead acts as the plaintiff / claimant.
While loans for structured settlements are commonly applied to injury cases, they can also be used to solve many kinds of non,injury claims and disputes, such as attorney costs, bad faith claims, breach of contract, divorce / alimony / child support proceedings, employment litigation, environmental litigation, legal malpractice, long-term disability buyouts, property disputes, and punitive damages, among others.
Relevance of loans for structured settlements
While not having to sue or be sued by someone is indeed the best scenario, life is full of unpredictable events on a daily basis. You never know when an unfortunate accident might happen to you, or when you may be involved in an incident after which you need to file a case against someone.
To make the long story short: it can happen to anybody, anytime, anywhere.
In this aspect, structural settlements are relevant to people’s daily lives, and it helps to familiarize oneself with a possible course of action should you encounter certain very unfortunate scenarios.
“Sustainable:” Why use a loans for structured settlements?
Since legal proceedings usually involve large expenses, there is a real danger that the defendants may not have enough funds to pay the loans for structured settlements, which puts both sides at risk – the defendant in danger of bankruptcy and not being able to fulfill their legal obligations, and the plaintiff in danger of an uncertain future, especially in cases of serious or catastrophic injury.
Structured settlements solve this problem – by ensuring regular payments that not only provide much, needed closure on the case, but also do not drain too much on the defendant’s resources, fulfillment of legal obligations becomes much more sustainable and secure.