- There are two methods for receiving settlement awards, each with advantages and disadvantages.
- It’s important to note that access to the settlement funds is not immediate, regardless of the payment option you select.
- The attorneys at Chopra & Nocerino are available to guide you through the settlement payment process and answer any questions you may have.
In New York, personal injury settlements can be paid out in two ways: as a single lump sum or through structured, recurring payments. The choice between these payment options depends on your individual needs. For instance, you might prefer immediate access to your funds, seek long-term financial stability, or want to minimize the tax impact on your settlement.
It’s important to remember that even after you sign the settlement agreement, there are still several steps to complete before you can access your funds.
Understanding the Payment Process for Personal Injury Settlements in New York
Once your case has reached a settlement, the countdown to your payout begins. However, there are a few final steps before you receive your financial recovery. These steps include signing paperwork to finalize the settlement, deciding how you want to receive your settlement payment, and addressing any outstanding liens and fees.
At Chopra & Nocerino, our personal injury attorneys understand how crucial it is to receive your settlement after an accident. We prioritize getting your settlement funds to you as quickly as possible.
Types of Personal Injury Settlement Payments
There are two types of settlement payment structures: lump-sum and structured settlements. Each has pros and cons, so it is important to understand both options to determine which best suits your needs.
Lump-Sum Payment
A lump-sum payment provides the full settlement amount in a single transaction. This option offers immediate access to your recovery, making it easier to cover major expenses, invest, or build savings. For most personal injury cases involving physical injuries, the payout is not taxable under federal or New York law. However, because all funds are delivered at once, a lump sum may not be the best fit for individuals concerned about overspending or managing large sums of money responsibly.
Structured Settlements
A structured settlement distributes your recovery through scheduled payments over time rather than all at once. These payments are generally tax-free in personal injury cases involving physical injuries, and they can provide stable, long-term financial security. This option is often appealing for individuals who want a predictable income and protection against quickly exhausting their settlement. However, structured settlements offer limited flexibility. You cannot access more than the scheduled payments without court approval, even in the event of a financial emergency.
What Happens After You Reach a Personal Injury Settlement Agreement in New York?
Here is a brief overview of what to expect after an agreement is reached in a personal injury case:
Settlement Agreement
To finalize your case, you will sign a written settlement agreement. This document confirms the terms of your settlement and formally closes the case. It also typically includes a release, meaning you give up the right to bring further legal claims against the other party for the same incident.
Insurance Payment
After the agreement is signed, the defendant’s insurance company will issue the settlement check. This payment is sent directly to your attorney, not to you, and is deposited into the firm’s client trust account (also known as an escrow or lawyer trust account).
Deductions for Liens and Fees
Before you receive your portion, your attorney will use the settlement funds to resolve any outstanding obligations, such as medical liens, unpaid medical bills, or other case-related expenses. Your attorney’s contingency fee, as previously agreed, will also be deducted at this stage.
Final Payout
Once all deductions are complete, your attorney will disburse the remaining settlement funds to you.
How Long Does It Take To Receive Your Personal Injury Settlement in New York?
You can usually expect to receive your settlement payment within a few weeks after signing the final settlement agreement. However, this waiting period may vary based on several factors, including the processing time of the defendant’s insurance company, the complexity of the case, and any delays related to resolving liens.
At Chopra & Nocerino, we recognize how important it is for you to receive compensation after being injured in an accident. While we cannot control every aspect of the final stages before your payout, we strive to minimize any delays so you can obtain your financial recovery as quickly as possible.
What Are the Common Deductions From Your Personal Injury Settlement?
Before receiving your payment, various expenses will be deducted from the gross settlement amount. Some common deductions include:
- Attorney’s fees: Many personal injury attorneys operate on a contingency fee basis. This means that clients do not have to pay anything up front. The attorneys only receive payment if a settlement or verdict is achieved. Typically, attorneys are paid a percentage of the final award amount.
- Litigation costs: These expenses may include expert witness fees, filing fees, and costs for obtaining police and accident reports, among other things.
- Medical liens: Medical providers or insurers may have the right to be reimbursed from your settlement for the medical treatment they provided. For example, suppose your insurance paid for your medical care and the person responsible for the accident is now liable for those costs. In that case, your insurance company may ask to be reimbursed.
- Outstanding medical bills: All remaining unpaid medical bills resulting from the injuries you sustained in the accident will be paid before you receive your settlement amount.
Chopra & Nocerino operates on a contingency fee basis, meaning you pay nothing unless we successfully secure compensation for you. Our fee will be calculated as a pre-negotiated percentage of the amount we secure, so there will be no surprises down the road.
Why Chopra & Nocerino Is the Right Choice for Personal Injury Settlements in New York
At Chopra & Nocerino, our New York attorneys are committed to helping victims of serious injury accidents secure the compensation they rightfully deserve. With over 20 years of combined experience, our personal injury lawyers have successfully obtained hundreds of millions in verdicts and settlements. We understand the challenges you face, which is why we treat each case with personalized attention and provide the support our clients need every step of the way.
Contact us today for a free, no-obligation consultation to discuss your personal injury case.
