What are lump-sum settlements and when can I expect to receive a lump settlement?
Lump-sum settlements are one-time payments made by insurance carriers to payout/buyout your insurance policy. Lump-sum settlement offers are made in two scenarios:
When you’ve filed a lawsuit for your disability benefits after the insurance company denied your benefits and any appeals - After filing a lawsuit, the insurance company will engage in settlement negotiations. The court will also require the parties to attend a mediation to discuss potential settlement. The insurance company will offer you a lump-sum settlement in exchange for a full release from the lawsuit.
While receiving regular disability benefit payments - The insurance company may choose to offer you a “buy-out.” In other words, the insurance company recognizes that your disability may be permanent. Rather than continue to issue regular payments through the end of your policy, the insurance company may offer a lump-sum buyout in exchange for a full release of any obligation to pay such benefits. Acceptance of a buyout offer is voluntary.
What does it mean?
Any lump-sum settlement is considered a final payout from the insurance company. This means that your relationship with the insurance company is over. You will not receive additional money from the carrier and you will not be able to sue the insurance company. On the other hand, you will no longer have any obligation to provide any information to the insurance company. This means no more medical record requests or requests to complete forms. The two parties are released of their obligations under the policy.
Should I accept a lump-sum settlement offer?
It depends. You should, however, hire an experienced disability attorney to review the offer and the particular details of your case. Additionally, most offers are negotiable. Never accept the first offer from an insurance carrier. Instead, hire an experienced attorney to negotiate on your behalf.
Help from a Lawyer with Expertise in Disability Insurance
Disability insurance law is complex. Hiring an experienced disability attorney is important. Because all disability lawyers at this law firm focus on disability insurance claims, we have expertise in disability insurance law.
- We have experience with every major disability insurance company;
- We have a proven track record of success by winning major disability lawsuits;
- We have recovered millions of dollars in disability benefits for clients;
- We never charge fees or costs unless our clients get paid.
The firm can help at any stage of your disability insurance claim, including negotiating a lump-sum settlement.
Because federal law applies to most disability insurance claims, our lawyers are able to represent clients across the country.
Call to speak with an experienced disability attorney. Consultations are free.