Normally, a plaintiff that wins a monetary award is entitled to collect the entire amount awarded as a lump sum. Some states, however, permit or require structured settlements; Instead of receiving one lump-sum payment, the award is paid out over many years. This is a similar concept to state lotteries that allow you to choose a cash option or get yearly payments.
Smaller defendants won't have to sell off their assets to pay a large jury award in one lump sum. Plaintiffs can't squander their entire award, leaving them unable to pay for future medical expenses.
Plaintiffs with a great deal of immediate expenses, like medical bills, may be unable to pay them in a timely manner. In some cases, if the plaintiff dies before the payments end, the defendant gets to pocket the money instead of paying it to the plaintiff's family.
Tort reform advocates claim that structured settlements will keep small businesses from going under if they're hit with a large jury verdict. Others point out that lengthy structured settlement plans are inherently unfair to people with short or diminished life expectancies.
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