Settlement Funding

Settlement Funding

Primary Structured Settlement Market

To help educate settlement recipients we will provide an overview of the industry that may clear up mixed messages you may receive about the market.

There are two distinctly different sides of the structured settlement market that you should understand. The primary structured settlement market is made up of companies that help individuals set up a structured settlement. When one is in litigation, typically suing an insurance company for an injury they may be offered a cash settlement. In those circumstances settlement may be offered as a one time cash pay our or as a structure agreement.

Primary settlement companies work with you and the insurance company making the cash award to set up a settlement. The purpose of this type of company is take into account all the factors of the case and your situation to set up an agreement that is in your very best interests of a long period of time. So factors like the amount of the cash award, your current financial situation prior to receiving the cash award, your ability to work in the short and long term. They will help putting all the pieces into place so that you have a settlement that will meet your needs.

Not to further complicate the role of the primary industry but another function they play is to help work with the insurance company to set up the annuity. The annuity is often set up via an insurance company (but different from the defendant in your lawsuit – the annuity cannot be administered by the same insurance company). So it is necessary to purchase an annuity via a second company that will then make the payments to you at the recurring time intervals that you set up (monthly or quarter are typical timeframes for payments).

So this is the first side of the industry that has companies in the “primary market” helping individuals to receive and set up the settlement to best fit their needs and circumstances.

The other side of the industry is the secondary market to learn more about selling your future payments.