How You'll Get Paid After A Settlement Is Reached

Knowing how settlements are paid can make the process more transparent when you are involved in a personal injury case. Settlements can provide financial relief without going through a lengthy trial. Understanding the key terms and steps in receiving your settlement can help you manage your expectations and make informed decisions. This knowledge lets you stay informed and reduces stress during a challenging time. Here, we break down the settlement process and the methods of receiving your payment. It’s essential to consult with your lawyer throughout this process to ensure all your questions are answered and your rights are protected.

The Settlement Process

When both parties agree to settle a personal injury claim, they negotiate a specific amount of money the injured party will receive. This agreement is documented in a settlement agreement, which is a legally binding contract. Once signed, the defendant or their insurance company must pay the agreed-upon amount. Before the settlement payment is issued, you must sign release forms stating that you accept the settlement and agree not to pursue further legal action regarding the injury. This document protects the defendant from future lawsuits related to the same incident. 

Almost every personal injury attorney you come into contact with works on a contingency basis. You pay them for their services with your settlement amount. Because of this, the settlement check will typically get sent to your lawyer first. The lawyer deducts their fees and case-related expenses before giving you the remaining funds. Understanding the deductions is essential to reviewing the fee agreement with your lawyer beforehand. The payment is typically made around a month after you sign the settlement agreement. Granted, this should not be taken as fact because the specifics of your case dictate the timeline associated with receiving your settlement. 

Receiving the Payment

Settlement payments can be made in two main ways: lump sum and structured settlements. A lump sum payment provides the entire settlement amount at once. This straightforward method gives you immediate access to your money, which can help cover significant expenses such as medical bills or debts. A structured settlement, on the other hand, distributes the payment over time. 

This option offers a steady income stream, which can be beneficial for managing long-term expenses like ongoing medical care. The structured settlement terms are outlined in the settlement agreement, ensuring regular payments according to the agreed schedule. Proper management of your settlement funds is crucial. If you are receiving a large sum of money, it would be wise to contact a financial advisor. They can assist with budgeting, investing, and planning for future needs. Additionally, understanding the tax implications of your settlement can prevent unexpected financial issues down the road.

Speak to a Personal Injury Attorney to Get the Settlement You Need

Understanding how personal injury settlements work is essential. If you have questions about your personal injury case or need assistance with a settlement, schedule a free consultation with our office today. Our experienced team is here to help guide you through the process.