A Structured Settlement is when an insurance company agrees to pay an individual usually a court decided amount of money for a set length of time, as a financial compensation for an individual's health and recovery financially due to an accident inflicted by another company or individual. Documents are drawn up in a structured settlement which include an agreement, a qualified assignment, an annuity application, a court order, and an annuity policy. This legal set of documents is put in place to make legal and clear notice that a financial claim and payment agreement is in place for a duration of time and set annuity payments to an individual.
Structured settlement annuity payments can be made for the duration of the life of the claimant or any set period of time, usually over several years. The payments of the annuity can be paid in differing amounts of each payment or equally divided payments for a set amount of time. The payments from a Structured Settlement Annuity are guaranteed by and are not subject to income taxes.
