Structured Settlements and Dispute Resolutions

Toronto Personal Injury Lawyer Albert Conforzi: I was honoured to be asked to take part in a discussion last week on the subject of structured settlements at a Canadian Defence Lawyers (CDL) conference.

CDL focuses on the education of its members who work on behalf of insurers. As a lawyer for accident victims, I was asked to bring my own unique perspective to them on the use of structured settlements in the resolution of accident benefits disputes. In my nearly thirty years of practice - which includes several years as an insurance defence lawyer - I have made regular use of structured settlements for my clients in the resolution of disputes.

A structured settlement is a tax-free annuity purchased with the proceeds of a dispute settlement. It is purchased from one of 5 of the life insurance companies that offer them, and as a result, must be purchased through licensed brokers. The goal of the annuity is to produce a tax-free stream of payments for the rest of a victim's life, or as appropriate. This allows them access to the funds necessary to live without having to deal with their insurer any longer.

Ultimately, to make good use of structured settlements, a lawyer must be prepared with all the background information necessary to predict as best they can the clients' needs going forward.

Insurance companies are not obliged to settle claims in a lump sum, but will often do so. The advantage to them to go this route is that they no longer have to administer the file. The advantage to the claimant is the freedom to exercise their judgment as to how they will use their money, without intrusive meddling by an insurer. Note that structures may only be used by consent of the parties, or by a Court Order.

There are some insurers who deal with only a particular broker. Why, you ask? It's a very good question, and one can only speculate, but I am sure you can probably come up with a good reason or two. For my part, I always have my quotes done through my own sources, and never just accept what the insurer's broker says so.

Ultimately, to make good use of structured settlements, a lawyer must be prepared with all the background information necessary to predict as best they can the clients' needs going forward.

It is very nice to be recognized by your peers as a preeminent practitioner in your field. In this case, it was my opponents recognizing what it is they wanted to learn from me. Have no fear though; I didn't tell them everything I know. I held some things back from which only my clients will benefit.

Albert Conforzi is a personal injury lawyer with Pace Law Firm in Toronto. His posts generally appear on Mondays.