How Wrongful Death Settlements Are Paid

Having someone die in your family of a wrongful death can cause a lot of stress. Not only are you dealing with the pain of losing a loved one, but you also want to get justice. If it turns out a person passed away as a result of wrongful death, this is how the settlements are paid.

Methods In Which They Are Paid Out

A wrongful death settlement can be structured in various ways, the most common being lump sums or structured settlements. There is no predetermined method; the involved parties will decide how the money will be distributed. That being said, the final amount may also determine how the money is paid out.

For example, if the defendant has to pay a relatively small amount of money, then it will likely be arranged to be given in a lump sum. However, if the amount of money is substantial, it may automatically be arranged in a structured settlement. This will also apply if the defendant is considered personally liable for all the accusations.

Very often, a defendant does not have the means necessary to cover all the payments in a lump sum. In that case, a lump sum method is arranged. However, if the public financial records show or income shows that the person can handle it, the lump sum method is often chosen.

What If The Defendant Has Liability Insurance?

Wrongful death settlements can branch out into two other types of payment: either by public liability insurance or from their own pockets. Very often, a person that does not owe a duty of care to another while performing their business may not have insurance.

This can be a car or pedestrian accident where they are not especially responsible for a patient’s life. In this case, if the defendant is not insured, then they will have to pay the entire amount of money using their assets.

However, industries such as medicine are slightly more complicated. As they are responsible for people’s lives every day, most of them prefer to set up public liability insurance. If a lawsuit is filed for wrongful death, then their public liability insurance will most likely pay for the settlement.

Similar to any other lawsuit, the insurance company will attempt to disprove the liability of its client. After all, they don’t want to reduce their profit by giving out money left and right. That being said, if the plaintiff has a good attorney, they may receive the justice that they deserve for their loss.

Who Gets the Money?

In New Jersey, according to the N.J. Stat. Ann. § 3B: 5-3, 2002, the compensation from a wrongful death lawsuit is distributed to direct beneficiaries of the deceased person. This can include the surviving spouse, a state-registered domestic partner, along with the children and stepchildren.

In certain circumstances, when none of those mentioned above parties exist or have survived, the settlement goes to the parents or siblings of the deceased person. You may want to hire a family lawyer or if the death was caused by a medical mistake, a medical malpractice lawyer.

This is because the law steps may be slightly different when a medical institution is involved. If you live in a New Jersey city such as Newark, it is recommended you hire a Newark medical malpractice lawyer. They will help you figure out the right course of action.

How Is a Wrongful Death Settlement Distributed?

Based on your degree of connection to the deceased person, along with the number of surviving beneficiaries, the lump sum may be distributed differently. Here is how the money is paid out, based on the priority under interstate laws:

Spouse: If the victim had a spouse, with no parents and no children, then all the money will go to the spouse.
Children: If the victim had legal-aged children but no surviving spouse, the money will be equally distributed among the children.
Spouse + Children: If the victim had a spouse and children but no parents, then the spouse will receive around 2/3 of the balance, and the rest is equally distributed among the children.
Spouse + Parents: If the victim does not have any children, then around 2/3 will go to the spouse, whereas the rest will be equally transmitted among parents.
Parents: If the victim was unmarried with no children, the money will be paid out equally to the parents.
No Parents: If the victim was unmarried with no children, the money will be given to the children of their parents (i.e., brothers and sisters and their descendants).