In any
physical injury case, the plaintiff and defendant negotiate issues
such as the victim's medical care and basic living and family needs.
Oftentimes, one side (or both) will bring in an expert, such as a
structured settlement broker, who provides calculations on the
long-term cost of these needs.
When there is agreement on the benefits due to the injury victim
(which can happen before, during or after a lawsuit), the defendant
will agree to fund a stream of payments that meet these needs. The
defendant then assigns this obligation to an experienced third party,
such as life insurance company, that funds the damage payments with an
annuity.
An annuity has been the preferred way of funding because of its
pricing and flexibility. An alternative is a trust fund which invests
only in United States Treasuries.
As these issues involve complex calculations, you should always
consult your attorney and a structured settlement professional..