“The decision for personal injury settlement recipients to accept their settlement as either a single lump sum payment or as a structured settlement annuity can have a significant impact on their financial future. As a result, these individuals should seriously consider the benefits offered by a structured settlement annuity and the security that can offer,” says Bejan Shirvani, vice president, Structured Settlements with MetLife. “With more than three-quarters of the personal injury settlement recipients we surveyed reporting serious or severe injuries (76%), this underscores the need for financial certainty, especially considering the associated medical bills, potential lost wages and reduced earnings capacity they may experience.”

Annuity Payments vs. Lump Sums

The Study found that 96% of settlement recipients who chose to receive monthly annuity payments instead of a lump sum said that monthly payments made it easier to manage their budget. Meanwhile, nearly three quarters, 72%, of settlement recipients who took a lump sum said their budget would be easier to manage if they had instead chosen monthly annuity payments.

Nearly eight in 10 of structured settlement annuity recipients, 79%, report that their standard of living has improved since receiving their guaranteed annuity payments from their settlement. This includes three in 10 (30%) who say it is much better. Similarly, 76% feel more confident in their financial decisions.

When looking at spending, 45% of lump sum recipients typically spend their money on paying down debt within the first year of receiving their lump sum and 41% spend their funds on medical and/or long-term care expenses. For ongoing expenses, recipients spend on daily expenses, debt and medical and/or long-term care.

Spending Habits and Regrets

In addition to spending their funds on necessities and medical care, some lump sum recipients spend on items like purchasing a new vehicle (39%), home improvements/repairs (29%), and vacations (18%). However, the Study found that almost half of lump sum recipients who made a significant purchase within the first year, 49%, express regret regarding their expenditure.

Along with these regrets, the Study found that lump sum recipients also feel some uncertainty when thinking about the future. Despite most feeling they have enough money remaining for the basics, 51% are cutting back on spending due to fears of running out of money.

When it comes to potential changes in their approach, the Study found both groups would take a different path if they had the opportunity. At the time of settlement, with an average settlement amount of $324,148 among those surveyed, 43% took a full lump sum, 23% took a full annuity, and 34% took a partial settlement. Given what they know now, most say their ideal settlement would be a partial settlement – only 15% would choose a full lump sum.

“While some may believe that lump sums may offer more flexibility when it comes to how a personal injury victim uses their settlement, the lack of guardrails can lead to potential financial missteps and overspending, as demonstrated by the Study’s findings,” said Shirvani. “Given the size and significance of these settlement amounts, personal injury victims and their advisors should give serious consideration to structured settlement annuities. This solution can help protect their financial future, allowing them to focus on their well-being rather than potential uncertainty and financial stress.”

About the Study

The research was conducted online in the United States by The Harris Poll on behalf of MetLife among 503 US adults, 18–75, who have ever received $25K+ in a personal injury lawsuit settlement (or is the guardian for someone who has) and was given a choice between a lump sum and annuity payments. The survey was conducted January 9–31, 2025. Data are weighted where necessary by age by sex, race/ethnicity, region, education, marital status, household size, employment, and household income to bring them in line with their actual proportions in the population. Respondents for this survey were selected from among those who have agreed to participate in our surveys. The sampling precision of Harris online polls is measured by using a Bayesian credible interval. For this study, the sample data is accurate to within ± 5.1 percentage points using a 95% confidence level. This credible interval will be wider among subsets of the surveyed population of interest. To read the full report, visit. https://www.metlife.com/settlementstudy2025

About MetLife

MetLife, Inc. (NYSE: MET), through its subsidiaries and affiliates (“MetLife”), is one of the world’s leading financial services companies, providing insurance, annuities, employee benefits and asset management to help individual and institutional customers build a more confident future. Founded in 1868, MetLife has operations in more than 40 markets globally and holds leading positions in the United States, Asia, Latin America, Europe and the Middle East. For more information, visit www.metlife.com.