Structured
settlement payments are usually the result of a personal injury lawsuit
in which the defendant's insurance company funds the award amount with
an annuity policy that provides periodic payments and ongoing income to
the plaintiff. However, many people find the need to have a lump sum to
aid in paying off debt or medical bills. A long-term stream of payments
is not always the most beneficial method of receiving their award. A
secondary market has evolved around structured settlements that allows
consumers to sell all or a portion of their payments to a structured
payment buyer. These buyers, or factoring companies, then pay the
consumer a lump sum in return. In addition, other types of annuities,
such as lottery winnings, are usually paid over time and can also be
converted into a lump sum payment.