The purpose of a structured settlement of a minor is to ensure that the money resulting from a negotiated settlement (or a post-award verdict) will be safely and professionally managed
In tort cases, especially involving injured minors, the court will usually require that the payout of a personal injury settlement be structured rather than be received by the plaintiff in a lump sum.
The structured settlement is usually in the form of an annuity that guarantees a reasonable but safe return rate and is secured by a bond. Depending on the minor’s age and the financial circumstances of the minor’s family, payments will be made to the minor on a periodic basis, usually until the minor reaches the age of majority and sometimes even longer.
In some states, such as California, this judicial process is called a Minor’s Compromise.
