How do personal injury lawyers exaggerate their case results?
Case in point: today, I read about the "highest personal injury settlement in the history of New York State" (or something like that--you can the gist of it). A lawyer in Long Island settled a case for $14.8 million for a police officer paralyzed in a motor vehicle crash. Pretty impressive, right? Yes, it is...sort of.
When I read the fine print about the case, I discovered that the case did not really settle for $14.8 million. As I'm reading through the fine print, I find out that the case settled for $7 million in addition to monthly payments from a structured settlement annuity that will be pay the balance of the "$14.8" million settlement.
So, what's so misleading about a report that the case settled for $14.8 million? The actual payment made by the defendant is probably in the range of $8 million, or perhaps less. Why, you ask? There is an initial payment of $7 million and the remainder of the settlement is funded with an annuity that will pay a total of $7.8 million in monthly payments that are spread out over the remainder of the life expectancy of the injury victim. The cost of the annuity is probably about $1 million to fund the future payments--this is called the cost of the annuity.
Can you blame the personal injury attorney for reporting a $14.8 million settlement when the actual settlement was probably closer to $9 million? Yeah, actually I can. It is misleading to report a case result that reflects a much higher settlement than the actual figure. Consumers (you!) can be misled by such a report.
Keep in mind: when you read a report about an astronomical settlement, read the fine print. Things aren't always as they seem.
If you have any questions or want more information, I welcome your phone call on my toll-free cell at 866-889-6882.