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Life Changing Disability
For two years, Arturo was bedridden and incapable of taking care of even the simplest tasks for himself.
Life Changing Disability
For two years, Arturo was bedridden and incapable of taking care of even the simplest tasks for himself.

Arturo and His Family

Arturo, 40, was taking advantage of a rare weekday off by kicking a soccer ball around his front yard with his two children, Mickey, 13, and Abigail, 10. The presence of a commercial pressure washer working on his neighbor’s house worried Arturo slightly, so as a precaution he told his children to stay on the opposite side of the yard while he stayed between them and the neighbor’s house. While the decision took Arturo only a fraction of a second’s thought, he may very well have saved his children’s lives with it. What would later be diagnosed as a defective washer part caused water to build up so much pressure that the washer exploded, sending debris flying in all directions – including into Arturo’s front yard.

The force of the debris caused severe injuries to the back of Arturo’s skull, the left side of his face, his back, and his left leg. The injuries to his face and leg could be mended with stitches and surgery, but the injuries to Arturo’s skull and back required multiple surgeries over the span of a few years, as well as ongoing physical therapy. For the first two years, Arturo was bedridden and incapable of taking care of even the simplest tasks for himself. As a result, his wife, Annie, was forced to resign from her secretarial position to care for Arturo full time.

Arturo and Annie’s personal injury attorney settled for $3,000,000. After medical liens, expenses, and attorney fees, the net recovery would be $1,666,750. The lion’s share of the settlement would be allocated to Arturo, while Annie would also receive a settlement apportioned for her consortium loss claim. Their two children witnessed their father’s traumatic injuries, so they also had claims against the defendants. As minor children, they were not able to bring a claim on their own, and required a parent to sue on their behalf. Therefore, Arturo and Annie asserted claims on behalf of Mickey and Abigail as their Next Friend.

Due to his injuries, Arturo had not worked for over two years. He and his wife had exhausted their life savings. It was evident that Arturo and his family needed a Plan of Care to secure Arturo’s medical and custodial care costs, to help the family get back on their feet, to secure the children’s future educational needs and expenses, and to assure a better quality of life in the future.

Robin Young worked closely with Arturo and Annie to design a financial plan that would provide them with a steady stream of payments to help them meet their immediate and long-term goals.

Life Changing Considerations

  • Arturo would undergo several surgeries and require medical care for a few years.
  • If and when Arturo is able to return to work, his work ability will never be the same due to his injuries.
  • Arturo and his family received health insurance through Arturo’s employer. They could remain on the COBRA, but found the premium too costly.
  • Arturo and Annie exhausted their life savings, including their children’s college funds.
  • Arturo and Annie qualified for their home mortgage based on their combined income level. The loss of both incomes would result in the loss of their home unless they could assure the mortgage company that they would be able to make their monthly payments.

Arturo and Annie’s Desires and Personal Goals

  • Pay off debts
  • Cash savings for immediate needs and miscellaneous living expenses
  • College funds for their two children
  • Financial security for life

Plan of Care

  • Health Insurance: Arturo and Annie needed to enroll in private health insurance. Young introduced them to an insurance agent they could trust to provide their ongoing insurance needs.
  • SSDI and Medicare: With the assistance of a good insurance agent, Young provided application guidance to Arturo for Social Security Disability Income (SSDI). Once deemed disabled by the government, within twenty-four months, he would also qualify for Medicare. Arturo will remain on the private insurance plan with his family until he is assured that his Medicare is in place.
  • Estate Planning: Young introduced Arturo and Annie to an estate attorney for their immediate and future estate plans, including a design in the event Arturo or Annie become incapacitated, pass away, and/or leave a large estate to the children. In addition, as it relates to the structured settlement, Young worked closely with the estate attorney to determine a percentage of the structured settlement value and estate value in order to incorporate an Estate Commutation Rider within the structured settlement package. Because not all estates require an Estate Commutation Rider, as the circumstances differ depending on the living spouse and other variables, Young worked with the life company to procure special language to the Estate Commutation Rider adding flexibility and availability on a needs-basis only.
  • Debt Resolution & Cash Availability: $250,000.00 upfront cash from the settlement award to pay off the family’s immediate debts. Remaining upfront cash to ensure a readily available pool of funds for emergencies and unforeseen needs.
  • Structured Settlement: The remainder of the settlement award was structured in a plan to meet the family’s needs and desires, individually and as a whole.

Structured Settlement (the design of payment streams)

Arturo

$5,040.56 payable monthly for life, guaranteed for thirty (30) years.

Utilizing Arturo’s Life Care Plan and medical records, Young obtained a substandard age rating. The substandard age rating provided a better, more aggressive rate of return and overall benefit.

$2,500.00 payable annually for eleven (11) years guaranteed.

Arturo will receive an annual lump sum payment each summer until both of his children reach age 21. This “little extra” each summer will provide for family summer vacations, new school clothes, and other expenses.

$20,000.00 payable every five (5) years, guaranteed for thirty-one (31) years, which is seven (7) payments.

Arturo will receive a lump sum payment every five years until he reaches age 75. This extra income will help the family purchase those larger desires and needs (such as a new car, home appliances, and other big-ticket items).

$1,982,102.00 Guaranteed Benefit

$2,586,969.20 Expected Benefit

All benefits are tax-free.

Guaranteed and Expected does not include the upfront cash portion as illustrated to be $250,000.00 directly to Arturo during settlement disbursement, nor does this reflect and include Annie or the children’s structured settlement packages and guarantees.

Cost, rates, and benefits subject to change and review; the above has been provided as a sample illustration based on this case study.

Within the Release, language was carefully incorporated to designate Annie as Arturo’s primary beneficiary, and his children as secondary beneficiaries.

Annie

$1,160.76 payable monthly for Life, guaranteed for thirty (30) years.

Recognizing that Annie was a diabetic, on multiple medications, and had high blood pressure, Young requested current medical records also for Annie to obtain a substandard age rating. The substandard age rating provided a better, more aggressive rate of return and overall benefit.

$ 417,874.00 Guaranteed Benefit

$ 626,810.80 Expected Benefit

All benefits are tax-free.

Guaranteed and Expected does not include the upfront cash portion as illustrated to be $250,000.00 directly to Arturo during settlement disbursement, nor does it reflect and include Arturo or the children’s structured settlement packages.

Cost, rates, and benefits subject to change and review; the above has been provided as a sample illustration based on this case study.

Within the Release, language was carefully incorporated to designate Annie as Arturo’s primary beneficiary, and his children as secondary beneficiaries.

Mickey, age 13 and Abigail, age 10

$14,418.91 payable semi-annually for five (5) years guaranteed to Mickey (starting on his 18th birthday).

$17,577.09 payable semi-annually for five (5) years guaranteed to Abigail (starting on her 18th birthday).

All benefits are tax-free.

$100,000 premium for the benefit of each minor, to be assigned to each minor’s own structured settlement package. Abigail’s overall benefit and growth of an additional three years results in a higher return.

Cost, rates, and benefits subject to change and review; the above has been provided as a sample illustration based on this case study.

An annuity stream of benefits was designed to provide each child with a college education to help pay for tuition, books, and fees for five years. Should Mickey and Abigail choose not to attend college, or in the event they receive scholarships or have other plans, they can use their structured settlement benefits in other ways to meet their needs and desires.

Arturo and Annie felt relief and assurance for the first time since Arturo’s tragic accident. The Medicare and Medicare supplemental programs would provide Arturo with ongoing insurance and care, while the private insurance premiums were much more manageable for Annie and the children. The structured settlement provided Arturo and Annie with comfort that the family would be financially sound. Knowing that their children would receive the college education they desired brought back the hopes and dreams they had for their children.

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