Sell Structured Settlement Structured Settlement Basics 3

Question 1

Which type of structured settlement payment schedule pays equal amounts at regular intervals?

Accepted Answer

Level periodic payments

Answer

Level periodic payments are equal in amount and paid at consistent intervals such as monthly or annually throughout the settlement term.

Question 2

A structured settlement with 'increasing payments' typically adjusts by what method?

Accepted Answer

A fixed percentage or cost-of-living index each year

Answer

Increasing payment structures commonly apply a fixed annual percentage or tie adjustments to a cost-of-living index such as the CPI.

Question 3

Which entity issues the annuity contract underlying most structured settlements?

Accepted Answer

Life insurance company

Answer

Life insurance companies are the issuers of annuity contracts that back structured settlements, and they must meet state insurance regulatory requirements.

Question 4

In a structured settlement, what is a 'lump-sum deferral'?

Accepted Answer

A single large payment scheduled at a future date within the payment stream

Answer

A lump-sum deferral is a single large payment built into the settlement to be paid at a specific future date, such as for a college education or retirement.

Question 5

What is the typical role of a structured settlement broker?

Accepted Answer

They design and negotiate the payment structure on behalf of the plaintiff

Answer

A structured settlement broker works with the plaintiff and their attorney to design a payment schedule that meets the plaintiff's long-term financial needs.

Sell Structured Settlement Practice Test

Sell Structured Settlement Practice Test

Sell Structured Settlement Structured Settlement Basics 3