Why use a structured annuity for your child's injury settlement? Simple. You get three huge benefits:
1) Time growth. The funds have to be deposited into a bank blocked account anyway until the child turns 18 (under California law). With an annuity structure, you can take advantage of an insuance company's investment portfolio over time in comparison with the low return of a bank's interest rate.
2) Control of the funds. Parent's can plan ahead with the settlement funds by picking what age their child receives the settlement funds. This, of course, depends on the amount of the settlement. Some parents would like to be prudent with the settlement funds. They would rather "structure" payment to their child on periodic dates. For example, instead of the child getting everything when they turn 18, they can structure their access to funds in segments through time. So the child can recieve a lump sum amount at age 18, then another at age 20, or 21, then another at age 25, and so on. All the while, they are taking advantage of growth because the longer the funds are in control of the insurance company they are still investing those funds for return on investment.
3) Maximizes net recovery. Remember, the structured annuity is an efficient investment vehicle so it will be growing with guaranteed payments much better than a bank's interest.
So for all three reasons above, it is a great way to help an injured child maximize their net recovery. Parents love it for all three reasons above, and so do the judges who have to approve a child's injury settlement in California if the settlement amount is above $5,000.00. I love it because I know the child is getting the best possible result and return for their injury. If you would like more information on this please feel free to call me at (619) 813-7955 today.
