Why Self-Insured companies can benefit using structured settlements:
Stability and security: Structured settlements offer unmatched protection against future loss or dissipation of funds. People don’t have to be concerned with making a single cash payment last a lifetime, and are therefore less likely rely on public assistance for their wellbeing.
Tax-free income: Payments received in the settlement of physical injury and workers’ compensation cases are tax-exempt at the federal and state level, whereas investment earnings from cash-only settlements are generally taxable.
Low risk: Going to trial involves significant risks to all parties involved, and the time and expense of litigation can be a significant burden. Structured settlements allow the parties to author their own futures without the unpredictability of a trial.
Saved time and money: Structured settlements reduce administrative costs to self-insured entities, free cash reserves and expedite case closure. They also allow claimants to manage their own futures, with the benefit of payments timed to meet real needs. Maximized government benefits: In cases involving claimants eligible for Medicare, a structured Medicare Set-Aside ensures that Medicare’s interests are protected and the claimant maintains eligibility for future Medicare coverage. In cases involving claimants eligible for Medicaid, a structured settlement can be tailored to claimants’ eligibility requirements, including coordinating with Special Needs Trusts.
Creates goodwill and enhances pubic image: It is the right thing to do for many injured people or their survivors. The structured settlement industry estimates that the vast majority of cash settlements are dissipated within 5 years.
Rather than having an unhappy and financially distraught claimant in a few years, the flexibility of structured settlements creates virtually unlimited opportunity to tailor a settlement to each claimant’s specific needs. The structure might be simple or complex and is limited only by the creativity of the parties involved and the availability of products in the structured settlement annuity market.