How do structured annuities work?

A structured annuity provides exposure to stock markets, giving you the growth potential you need to achieve your goals. For each indexed account you select, the performance of an underlying index will determine how much you can earn (either up to a limit or subject to a commission). To make these periodic payments, the defendant usually purchases an annuity from an insurance company. That way, the defendant can remove his obligation from his books and transfer responsibility for the payment to a company experienced in handling periodic payments.

Structured settlements or structured annuities are both financial products and legal judgments. Choosing between a one-time payment and a structured settlement can have long-term tax and personal consequences. The decision to use a structured settlement must be made before finalizing the settlement agreement. The defendant or insurer then pays the settlement funds to a third-party assignment company, which assumes responsibility and purchases an annuity from a structured settlement insurance company.

In 1812, the Pennsylvania Life Insurance and Annuity Grant Company received a charter to sell annuities to the public. In addition to ensuring a continuous flow of income during retirement, many annuities are guaranteed with a minimum rate of return, which means that not only can your capital be protected against loss, but your profits can also be protected. The biggest advantages of structured agreements are predictable and secure income for the homeowner and the fact that the total amount of money you receive will be more than what you would get from a one-time lump sum payment. Your structured settlements can provide certain payments during childhood, additional disbursements to pay for college, etc.

Structured settlements can also be designed to increase payments over the years, starting at a relatively low level and ending at a higher level. If you are interested in selling your annuity or structured settlement payments, a representative will provide you with a free, no-obligation quote. Most structured settlements stem from personal injury, wrongful death, or workers' compensation claims. Some states also require hiring an attorney as a precondition for acquiring a structured settlement annuity.

Minors can benefit from a structured settlement in the sense that their futures can be financially insured to the point. The Standard Death Benefit Guarantee is a one-time benefit of the RiverSource Structured Solutions annuity. If you agree to take your compensation as a structured settlement, rather than receiving a large amount from the plaintiff, you will receive periodic payments over a fixed number of years.