Lump sum settlements are becoming increasingly common. In exchange for a release of all legal rights under the policy, insurers will often offer you a lump sum cash amount. If you receive such an offer, you are well advised to consult with a NY disability attorney familiar which such matters so that you can find out if you are receiving a fair settlement.
You should note that the lump sum settlement offers are always less, in most cases significantly less, than the present value of your benefits. The present value of your benefit is the amount that you would need today to purchase an annuity that would pay you monthly benefits equal to the benefits under the policy. Therefore, by agreeing to a lump sum settlement you will be getting less than what you are entitled under the policy. If it wasn’t less, the insurer would not be offering it. NY disability lawyers have comprehensive experience dealing with insurance companies on this level, and can help represent you in dire situations.
The pros of a lump sum settlement are that you have cash now. This may be helpful to you in getting through a particularly trying time. You also will not have to worry about an insurance company constantly monitoring your progress. If you receive monthly benefits, you will be asked to give periodic reports and may be asked to submit to physical examinations.