Can You Sell Workers Compensation Structured Settlement Payments?



Read here how to sell your structured settlement payments. Note: this is NOT for selling workers comp payments. If you are looking for selling your WC structured settlement payments, the information at this link is NOT for you.

It may be harder and more restricted to sell workers compensation structured settlement payments, but it IS possible in some cases.

Because selling your workers' comp is complicated and there are many factors involved, be prepared for difficulties in finding someone willing or able to buy your structured settlement payments.

However, the claim that selling workers' comp awards for a lump sum is definitely impossible or always illegal, may be an overstatement.

In any case, a court approval will be needed even if it is allowed and if you do find someone to whom to sell your workers comp structured settlement annuity payments.

When appearing before the court, the judge may want to determine whether the transaction and sale of your structured settlement is in your best interest, the reason why you are selling, your financial status and ability to support yourself, the intent what you plan to use the lump sum for, and whether you have been provided professional advice and full disclosure - just as would be the case when selling lawsuit payments of an auto accident personal injury claim.

It may just be much more complicated than selling other kinds of personal injury / illness structured settlement rights, and the question of whether it is worthwhile to sell insurance payments is more relevant in cases of workmen's compensation, as I'll further explain.

Here are relevant point for you to consider when thinking about selling your worker comp future payments. In this article I'll summarize the following key points....

  • What workers comp and other personal injury and wrongful death structured settlements have in common
  • Advantages of structured settlements in work injury claims
  • Restrictions on selling worker's compensation structured settlement payments
  • Special considerations: is it in your interest to sell workers compensation structured settlement payments?

Workers' Comp and Other Personal Injury Structured Settlements

Workman's compensation, like other personal injury structured settlements....

  • Are encouraged by the government, financial advisers, brokers and employers
  • Are considered Qualified Assignments and tax exempt (for physical injuries / illnesses, both the principal as well as capital gains
  • Are exempt from federal and income tax also when cashed out in exchange for a lump sum

Why Structured Settlements Are Favored In Work Injury Claims

I'll explain to you in a moment what are the special difficulties and limitations when considering to sell workers compensation structured settlement payments.

First, here's why a structured settlement is favored in the first place in many job injury / illness claims.

A structured settlement allows....

  • Employees / defendants to minimize workers' comp payouts
  • Injured workers to maximize compensation by collecting interest on periodic payments
  • Injured workers to be exempt of paying taxes on the compensation annuities as opposed to up-front lump sum awards
  • Injured workers to receive a steady stream of income and source of support to compensate for economic loses and cover medical expenses
  • The government to ease the burden of financing medical expenses for the injured

Now, here's why it may be difficult to sell workers compensation structured settlement payments:

Why It May Not Be Easy To Sell Workers Compensation Structured Settlement Payments

For several reasons it may not be easy, lawful, or in your best favor to sell workers compensation structured settlement payments.

Selling workers' comp structured settlement payments...

  • may not be allowed in some states
  • may be allowed only if you have an additional source of income
  • may be opposed by the workers compensation board, and judges may rule in their favor
  • may not be worthwhile because of the low lump sum payout due to the risks involved - return to work, death of the claimant and other considerations compromising the security of the workers' comp payments

Key Point Affecting Your Workers' Comp Structured Settlement Payments Sale

The following key points are among those that be assessed by factoring companies when thinking about buying out your worker's comp:

  • Nature and extent of your injury
  • Level and expected duration of disability
  • Life expectancy
  • Rating of the structured settlement annuity issuing company
  • State where the structured settlement was signed
  • Structured of the payments, and amount of payments to be sold

What Else You Should Consider When Selling Your Workers' Comp Annuity Payments

Definitely talk to an expert and adviser to discuss....

  • Wisdom of selling your insurance comp annuities for a lump sum
  • Legalities of transferring your payments
  • Tax implications, if any
  • Effects of the workers' comp sale on your eligibility for government medical assistance, social security and other benefits

Read also:

Selling to generate cash for structured settlement payments

Learn More: Be informed for selling power to sell structured settlement payments 

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