How are Wrongful Death Settlements Paid Out?

Wrongful death cases can be complex. If you or your family member has filed a successful claim, it’s important to understand how the settlement will be disbursed.

So, how is a wrongful death settlement paid out? Settlements may be distributed as lump-sum payments, structured settlements, trust funds, or a combination of these methods. 

If you’ve won a wrongful death case, a Los Angeles wrongful death lawyer can help ensure you receive the money you deserve.

What Ways Are Wrongful Death Settlements Paid Out?

Wrongful death settlements can be paid out in several ways:

• Lump-sum payment: With this method, the settlement amount is paid all at once. Families often prefer this option because it allows them to address immediate financial needs, such as funeral expenses, medical bills, or outstanding debts.
• Structured settlements: This method involves periodic payments over time, which can provide financial security for years or even decades. Structured settlements are often used when minors are involved or when the payout amount is substantial.
• Trust funds: In some cases, the settlement funds may be placed in a trust, especially when beneficiaries are minors or individuals who require long-term care. A trustee can manage the fund to ensure proper usage of the money.
• Combination of methods: Families may choose to split the settlement into a combination of lump-sum and structured payments. This provides immediate funds for pressing needs while ensuring long-term financial stability.

Each of these options has its advantages. A wrongful death attorney can help you determine which works best for you.

How Long Does It Take to Get Paid a Wrongful Death Settlement?

The timeline for receiving a wrongful death settlement varies from case to case. Some may receive the money they’re owed within a month or two, while others may have to wait a year or longer. Factors that can influence this timeline include:

• Case complexity: More complicated cases, especially those involving large corporations or multiple parties, can take longer to resolve.
• Negotiations: Settlements often involve extensive back-and-forth negotiations between attorneys and insurance companies, which can extend a case’s timeline.
• Court approval: If the settlement involves minors or a structured payment plan, court approval may be required, which can delay the settlement’s disbursement.

Who Pays in a Wrongful Death Lawsuit?

Who pays in a wrongful death lawsuit depends on the specifics of the case. Potentially liable parties include:

• Insurance companies: In many cases, the settlement is paid by the insurance company of the at-fault party. For example, in a car accident, the driver’s auto insurance may cover the settlement.
• Individual defendants: If the responsible party does not have adequate insurance, they may be personally liable for the settlement amount.
• Corporations or employers: In cases involving workplace accidents or defective products, a company or employer may be held responsible.

How Are Wrongful Death Settlements Divided?

When multiple family members are involved, dividing a wrongful death settlement can be complex. Typically, the distribution is based on:

• State laws: Different states have unique rules about how settlements are divided among beneficiaries, which can include spouses, children, and parents.
• Dependency: Courts may consider the level of financial and emotional dependency of each claimant on the deceased.
• Pre-existing agreements: Families can agree on how to divide the settlement, often through mediation or legal counsel. If no agreement is reached, the court may decide.

In most cases, spouses and children are given the highest priority, followed by parents, and then extended family members such as siblings or grandparents. This hierarchy ensures that those who were most financially dependent on the deceased receive adequate compensation.

How Are Wrongful Death Settlements Calculated?

Several factors determine the value of a wrongful death settlement, including:

• Economic damages: These include measurable losses such as lost income, medical expenses, and funeral costs.
• Non-economic damages: These encompass intangible losses like emotional distress, loss of companionship, and pain and suffering.
• Punitive damages: In some cases, courts may award additional compensation to punish the at-fault party for particularly egregious behavior.

Expert witnesses, such as economists or medical professionals, are often called upon to provide evidence supporting the financial valuation of the claim.

What Types of Compensation Can You Recover?

Wrongful death settlements cover a broad range of damages, including:

• Medical expenses: You can recover costs related to treatments and hospital stays incurred before your loved one’s passing.
• Funeral and burial costs: You can be reimbursed for expenses paid to arrange end-of-life services.
• Loss of income: You can receive compensation for the deceased’s future earnings.
• Loss of benefits: You can recover the value of benefits such as health insurance, pensions, or retirement contributions.
• Emotional distress: You can seek compensation for the grief and emotional suffering experienced by you and your family.
• Loss of consortium: You can claim damages for the loss of companionship, support, or marital relations.

Is Money Won in a Wrongful Death Lawsuit Taxable?

Generally, wrongful death settlements are not taxable under federal tax laws. However, if the settlement accrues interest before it’s paid out, that interest is typically considered taxable income. 

In addition, certain damages, such as punitive damages and those awarded for emotional distress, may be taxable.

Who Can File a Wrongful Death Claim?

Eligibility to file a wrongful death claim varies by state but generally includes:

• Immediate family members: Spouses, children, and parents are typically eligible.
• Extended family: In some states, siblings, grandparents, or other relatives may also file a claim.
• Personal representatives: If the deceased’s estate has an appointed executor, they may file the lawsuit on behalf of the beneficiaries.

What Are the Odds of Winning a Wrongful Death Lawsuit?

Your odds of winning a wrongful death lawsuit will depend on the strength of your evidence and the experience of your lawyer. Having a skilled attorney and clear evidence of negligence or wrongdoing will greatly increase your chances of success.

Speak with a Wrongful Death Lawyer Today

The way a wrongful death settlement is paid out can have a lasting impact on your family’s financial security. An experienced wrongful death lawyer from Omega Law Group Accident & Injury Attorneys can explain your options and help make sure your compensation addresses your family’s needs.

Schedule a free consultation today to discuss your case.