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Understanding Structured Settlements

It’s always an honor to be quoted in the media, especially when the author is a well-known legal columnist.


Attorney Dennis Beaver writes a legal advice column, “You & the Law.” This week, he discussed structured settlements’ role in helping accident victims protect their long-term financial security. His column, “How to keep ‘friends’ away from settlement money,” was an excellent overview about the perils of accepting a large lump-sum cash settlement to resolve a physical injury or wrongful death claim.


As Beaver notes, “In a structured settlement, instead of receiving a single, lump sum payment, part or all of the money is used to obtain an insurance annuity which provides a guaranteed, long-term stream of tax-free income payments tailored to the accident victim’s specific needs….” He adds, “Most people are not good at managing large amounts of money suddenly received.”


Here’s an excerpt:


“Start giving in, and Ben moves from target to financial victim,” according to Peter Arnold, a longtime structured settlement consultant and former Deputy Executive Director of the structured settlement industry’s trade association. “It’s like throwing a raw steak into the ocean when you know that sharks are there.”


“Often, the temptation to share this sudden wealth overrides better judgment about saving it for the future. A structured settlement is like putting a German Shepherd in front of your money to make sure efforts to grab and spend it easily fail, and allows you to honestly state, ‘I would love to loan you money, but it is beyond my reach,’ he points out.


You can read the full column on the Hartford Sentinel’s website here. (To Peter Swinehart, my excellent Landon School English teacher from the 1980s, you have my apologies for the mixed dog and shark metaphors.)


Also, it’s great to see Dennis quote my longtime friend, Derek Sells, Managing Partner at The Cochran Firm in New York. Derek and I were in the same class at Dartmouth and he’s a top-notch, widely respected attorney.

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