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About Structured Settlements

Structured Settlements are, in essence, guaranteed tax-free annuities or pensions.

  • The tax-free status of Structured Settlements is as a consequence of Government of Canada regulation.
  • Structured Settlements were introduced by the Government of Canada so as to create an incentive for those made vulnerable by injury to invest their settlement monies in something that is not likely to be lost prematurely.
  • Structured Settlements are available only in reference to compensatory damages for personal injury or death; that is, no other monies are eligible to be invested in Structured Settlements.
  • Structured Settlements are available only upon the consent of the casualty insurance company or by Court Order; that is, they are purchased by the casualty insurance company on behalf of the claimant.
  • Structured Settlements are only available at the time of settlement; they cannot be had after settlement funds have passed into the hands of the claimant.
  • Structured Settlements can be put together in a variety of different ways (e.g., short-term, long-term, indexed, non-indexed, etc.), but once in place, the tax-free, guaranteed payments of a structured settlement are made in accordance with the plan selected; that is, they are non-assignable, non-commutable and non-transferable, and thereby preclude the possibility of ever losing the investment.
  • Structured Settlements, as a source of guaranteed tax-free income, may make the recipient credit-worthy to varying degrees, depending on the plan selected.
  • Structured Settlements are, effectively, judgment proof insofar as the recipient of a
  • Structured Settlement cannot be forced to cash-out a structure to relieve a debt.
  • Structured Settlements offer rates of return that generally exceed (significantly, for the most part, on a net-of-tax basis) other guaranteed investment options.
  • Structured Settlements offer a level of security that parallels Canada Savings Bonds.
  • Structured Settlements impose no management fees on the recipient.

Demystifying Structured Settlements Brochure

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