The United Kingdom (UK) and Canada
In the UK structured settlements are only used as payment for the largest financial awards. Most cases are paid as a lump sum. But, it is important to note that the UK does provide the same tax protection for structured settlements as the United States does. That is that money received as part of a personal injury or medical malpractice structured settlement is not subject to income taxes. And, the number of such structures in the UK is growing, though at nowhere near the rate of growth as the United States. When structured settlements are used in the UK they are done much the same way as in the United States, most often through the purchase of an annuity. The above is the same for structured settlement payout in Canada, structured settlements, while tax free and providing long-term financial assistance, are rarely used.
Because structured settlements are such a small part of the equation in the UK and Canada there is not the big industry for selling settlement payments in those countries, as we have in the United States. In fact, searches online for “structured settlement UK” reveal, at a glance, few such companies in the UK, whereas such a search in the US reveals dozens of companies, easily. But these structured settlements, and thus sales, are becoming more common in the UK.
As one British law office writes on their website, “There are now companies in the market which will buy for a cash lump-sum the annuity stream agreed under a structured settlement.” The lawyers go on to caution that the initial decision to take a lump sum or structured settlement should be well thought out and be part of the negotiation process in any settlements.
Know the laws, and your options!
Laws vary from city to city, state to state and country to country. But remember, sometimes you may be bound by not only the law where you live but also the law in the place where the insurance company who holds your annuity is stationed.