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Structured settlement

UK: a method of settling claims in respect of damages for personal injury under which the casualty insurer, instead of paying a lump sum to the plaintiff, makes a series of periodic payments which are usually funded by the purchase of an annuity on the life of the injured person.
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MEDICAL, US: Agreement to pay a specific amount at regular intervals instead of a lump sum payment.
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An alternative to lump-sum settlement of bodily injury liability claims or court verdicts. The claimant is paid specified sums at specified intervals as compensation for loss of income, medical and rehabilitation expenses, and pain and pain and suffering until a designated future date (possibly the claimant’s death). Many structured settlements are financed through insured annuities, and payments can be adjusted for changes in price levels or in the claimant’s situation.

Structured Settlements

The settlement of a casualty or workers’ compensation claim involving periodic annuity payments over an extended period of time, rather than in one up-front, lump sum cash payment. There may be certain advantages to a claimant under a structured settlement, including tax treatment of interest under the Internal Revenue Code, that are not present under a lump sum cash settlement. Structured settlements are designed to guard against the early dissipation of settlement proceeds by recipients, who are often minors or those in need of life-time care as a result of their injuries.