An auto accident settlement may occur when the parties in a car accident agree on a payment amount to cover costs of injuries and property damage. This can be done before trial in a pre-trial settlement, or it can also happen during the middle of trial. Auto accident settlements are basically a contract stating that the liable party will pay the victim a certain amount of money in order to make up for the losses they caused.
Settlements are generally looked upon favorably because they tend to save the parties time and money. Instead of spending week or months dealing with court, the parties can agree on a settlement and move on with their lives. The parties of course must be willing to deal with one another in a cooperative way in order for a settlement to work out.
What are Auto Accident Settlement Payouts?
Auto accident settlements are usually distributed in two ways. One is through a structured settlement. This is where the payments are made in regular installments over time. This helps the plaintiff to avoid the tax consequences associated with receiving large amounts of money at once. Structured settlements are sometimes called “annuity payment” plans.
An auto accident settlement payout is when the plaintiff receives the money all at once in a lump sum payment. This is also called a settlement cash payout, and allows the person to receive the money that they are entitled to without waiting. However, as mentioned, there can be major tax disadvantages to receiving a large sum of money all at once.
What if the Other Party Won’t Pay the Settlement Amounts?
One of the disadvantages to annuity or structured settlement plans is that the paying party may stop making payments in the future. This can be due to them going bankrupt, or simply refusing to pay (although such contracts are legally binding). Thus, some people choose to have an auto accident settlement payout to ensure that they don’t have any problems in the future.
If the defendant is unable to make the entire lump sum payment, the court can sometimes take other measures to ensure that the amount is paid. For instance, they may place a lien on the person’s property and sell it in order to meet the payment amounts.
Do I Need a Lawyer for Help With Auto Accident Settlement Payouts?
The choice of whether to select a payout vs. annuities can sometimes be a difficult one to make. You may wish to hire a personal injury lawyer if you need legal advice when it comes to auto accident settlement payouts. Your attorney can assist you in court and out of court, to help ensure that your rights are fully protected and represented. The laws governing settlements can be very different from area to area.