How are personal injury settlements paid out?

Personal injury settlements are usually paid out in one of two ways: as a lump sum or through a structured settlement. If a Plaintiff elects to receive a lump sum then a check is written in the total amount of the settlement, usually made out to the Plaintiff and their attorney’s law firm. The attorney will deposit the check in his/her firm’s trust account after which attorney’s fees/expenses are deducted and a check written to the Plaintiff for the remainder. Another option for the Plaintiff is to receive a structured settlement. Under this option, an annuity is purchased, usually from a life insurance company, where the Plaintiff receives regular payments over time, or regular payments interspersed with lump sums at various intervals throughout the life of the annuity. There are generally numerous options to choose from in terms of payment schedules.