structured settlement

Restructured settlements – what are these? Are these a joke?

Almost everyone is aware about what structured settlements are. A structured settlement is just a method of fixing settlement money in the form of structured payments. There are various advantages to this kind of approach and it helps resolve certain matters very easily. Structured settlements form a very powerful tool which can help you immensely in certain conditions. Structured settlements are used especially in cases where you want to save money which would otherwise be spent on taxes. It is most definitely a great tool and rather many insurance agents and brokers try to sell it to their clients.

But are you aware of the term, “restructured settlement”? There are some insurance agents who are trying to sell an investment policy called restructured settlement. The question which most definitely comes up is, “how do you restructure a settlement?”. It is understandable that a settlement can be structured but restructuring is a concept which seems elusive. How do you structure something which is already structured? Can’t the same thing be achieved by simply changing the policies of the structured settlement you went for?

An insurance agent may have tried to sell you a restructured settlement policy and it is possible that you would have just ignored the person. This is because insurance agents have a reputation of being clingy and annoying. This is a sad reality and almost all structured settlement brokers have to go through certain circumstances everyday. It is not uncommon for a person to introduce himself or herself as an insurance agent and be automatically snubbed by the other person. Imagine the following situation in your life: A life insurance agent asks you if you would like to buy an insurance for yourself and as is customary for people nowadays, you reply with a quick and concise no. The agent proceeds to ask you if you would care to elaborate why you don’t want to invest in a life insurance and again, as is customary, you respond with a no. The conversation abruptly ends and you are never able to hear what the agent had on his or her mind. It is possible that the agent was a genuine broker who was trying to sell you a good product but you snubbed the intentions anyway.

The reason for this is not your fault – it is the fault of those people who introduce themselves as real brokers but are no more than masqueraders. They are those who try to sell people things that don’t make sense. These “brokers” come up with a term which makes partial sense and give their clueless clients a long and detailed description about something which does not even make sense. However, they are so good with words that the clueless client usually plays along and believes them. Restructure settlement is just another term which has been construed for reasons that do not benefit anyone other than those who have come up with it.

When you look at the term “restructure”, you get an image of changing the existing structure of something. A restructure settlement is thus a way to change the structure of the arrangement. The website is a domain registered to a factoring company known as JG Wentworth SSC LP. The company basically advertises about restructured settlement and claims that it allows you to restructure your plan to whatever you want it to. Really? Is that even possible? Is restructured settlement defined somewhere in an official sense?

A structured settlement is defined under the Internal Revenue Code Section 5891 © (1) as an arrangement (A) which is established by (1) suit or agreement for periodic payment of damages excludable from gross income of the recipient under section 104(a)(2), or (ii) agreement for periodic payment of damages under any workers’ compensation law excludable from gross income of the recipient under section 104(a)(1), and

 (B) under which the periodic payments are (i) of the character described in subparagraphs (A) and (B) of section 130(c)(2), and (ii) payable by a person who is a party to the suit or agreement or the workers’ compensation claim or by a person who has assumed the liability for such periodic payments under a qualified assignment in accordance with section 130.

If you still don’t get the drift then let us lay all of this out in clearer terms for you. Restructured settlement is nothing but just a factoring company in action. The company will take your settlement money and then give it back to you in either lump sum or any other way which you might prefer. The most common problem which structured settlement clients suffer from is that they receive money in smaller installments than what they prefer over a period of time. They might like to change the plan and receive better installments over a shorter period of time.

There is no such thing as restructured settlement and it is just a term invented by a factoring company which simply factors your investment money.