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Should I Accept a Structured Settlement After a Car Accident

Before accepting a structured settlement it is extremely important to understand all aspects of your case.

In a personal injury case, such as a car accident or some other scenario where you might get injured because of another party’s actions, you should generally be compensated for all the medical costs you gather as a result of the injury.

car accident settlement st. louis missouri

If a car accident leaves you with a broken leg, the at-fault driver will generally be responsible for paying for all the treatment required through their auto insurance.

In most instances, insurance companies will offer compensation in the form of a lump sum, – you get all the negotiated sum through a single payment.

However, that’s not the only form of receiving benefits. Insurance companies can also offer structured settlements, meaning you get your compensation in installments. If this is the case, you may be wondering if you should accept their offer.

Why the Answer Depends

To understand if you’re better off accepting a lump sum or a structured settlement, you need to closely analyze your case to see which of the two works best in your favor.

The answer will most likely come from there. Structured settlements can be more beneficial as they offer the potential of a higher settlement. When you negotiate a lump sum, you have to account for past and future expenses, so it’s very likely for the estimations to be off. As a result, you may not receive enough compensation to cover all your expenses.

With a structured settlement, however, you negotiate weekly, monthly, or annual payments that the insurance company has to make to you, for a specific time frame – sometimes even for life. As a result, the total amount of benefits in a structured settlement could be higher.

Structured settlements also give a sense of financial stability, which is very important for car accident victims who might lose their employment as a result. Since you get regular payments from the insurance company, this may give you some peace of mind financially.

When It’s Not a Good Idea to Accept

Structured settlements aren’t ideal for all car accident claims. For one thing, they will not help car accident victims that must give a considerable amount of money all at once. Because your benefits are given in recurring settlements, even the initial payment, which is usually higher, might not be enough to cover the bulk of medical expenses or other bills.

Moreover, the amount you ultimately get is influenced by inflation. The structured settlement will state a particular sum you will get, but it will not account for market changes like inflation. So, if you have to get $100 weekly, over time, that sum may have less buying power, and your settlement may not cover all the expenses you initially negotiated.

What Should You Do?

Reach out to a St. Louis car accident lawyer as soon as possible after an accident. It is very important to understand all aspects of your situation before you make a decision, and an attorney can help tremendously. Give us a call 24/7 at (314) 361-4242 for a FREE case evaluation.

Updated: July 6, 2020