Structured settlement payments are becoming popular because of the advantages they offer over other forms of payments and investment options. The payments which are available in the form of annuities are tax-free at the state and federal levels. Moreover, the payments are secured by state and federal laws. The annuities can be invested in U.S Treasury Securities and other low-risk government insured options.

As against a structured settlement, a lump sum can be difficult to manage by an individual who will have to grapple with the complexities of financial investment and tax laws. Moreover, if the management of a lump sum amount is handed over to a third-party who turns out to be unscrupulous, the resulting loss can be very heavy. In contrast, with structured payments, the loss is usually of an amount due at a given time. Structured settlements offer flexibility and the payment cycle can be fixed according to the beneficiary