Dale and Peter

It was an awkward situation for everyone: while attending a neighborhood cookout, Dale’s two-year-old son Peter had suddenly lunged forward to hug the host family’s Cocker Spaniel when it leapt up and bit him in the face, scarring his cheek. Despite an understandable new hesitancy around dogs, the boy had recovered well and appeared to need no further treatment. 

After reimbursement for the medical bills, the neighbor’s insurance company offered $10,000 to settle the claim. Since the wound had healed well and the child had no immediate income needs, the claimsperson had mentioned to Dale that he could “structure” the settlement, using the funds to establish a college fund for Peter. 

When converted into future payments, the $10,000 original payment was able to produce a college fund of four annual payments of $5,775 each beginning the summer of Peter's 18th year for a total college fund of $23,100.

Dale was pleased to be able to convert an afternoon everyone wanted to forget into a future they could all look forward to.

Illustration Including Taxable Equivalent Payments

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