Case Study

A Case Study:

A young child and her parents sue an OB/GYN after a devastating birth injury. The child is brain damaged, and will need future medical expenses, special schooling/education, loss of future income, and continuing general damages. 

After lengthy negotiations and mediation, the case was settled for $1,000,000.00. After attorney fees and expenses, $700,000.00 remained to be either STRUCTURED or placed in a TRUST. Since the child was not of the age of majority (minor: under 18), the settlement, by law, had to be approved by the probate court. The doctor's insurance company offered a STRUCTURED SETTLEMENT. The plaintiff attorney set up a Special Needs Trust (SNT). The court wisely retained outside counsel, to act as an independent resource to aid the court.  

After careful study of the structure, outside counsel maintained that the primary purpose is to preserve the funds for the use and benefit of the child AND to PRESERVE and ENHANCE the government benefits the child was already receiving. A desire to possibly secure a higher rate of return is secondary! The STRUCTURED SETTLEMENT ANNUITY will be TAX FREE and GUARANTEED, which will be far more beneficial to the child because his future will be well protected. The child will never be able to gain meaningful employment and thus has NO tolerance for stock market volatility. The structured settlement payment stream was also increased with a rated age (substandard life expectancy) which can ONLY be obtained through a structured settlement. 

A Secured Pooled Special Needs Trust was set up, with a STRUCTURED SETTLEMENT Life Annuity, guaranteed for 30 years, paying $7,835.00 semi-annually, with payments increasing 3% annually. TAX FREE!!! The structured settlement was set up to "feed" the SNT.  

With the Structured Settlement feeding the SNT, the expected payment total will be $3,946,629.00. TAX FREE & GUARANTEED Even when the parents are deceased, the child's financial future will be secure.