Structured settlement payments are usually the result of a personal injury lawsuit in which the defendant's insurance company funds the award amount with an annuity policy that provides periodic payments and ongoing income to the plaintiff. However, many people find the need to have a lump sum to aid in paying off debt or medical bills. A long-term stream of payments is not always the most beneficial method of receiving their award. A secondary market has evolved around structured settlements that allows consumers to sell all or a portion of their payments to a structured payment buyer. These buyers, or factoring companies, then pay the consumer a lump sum in return. In addition, other types of annuities, such as lottery winnings, are usually paid over time and can also be converted into a lump sum payment.
