Where individuals have sustained an injury which is either negligent or criminal, physical or mental or both and have received a financial compensation award, consideration should be given to setting up a Personal Injury Trust (PIT) to receive the payment.
In an increasingly litigious society, awards are becoming more commonplace and are growing in value.
Some of the highest value awards tend to involve medical negligence and by the nature of the circumstances giving rise to such awards, claimants may need some form of long term care.
Using a “PIT “ can bring many benefits.
Besides the normal protections using a Trust can add to a situation, one of the most compelling features of a “PIT” is the disregard from means testing by the Benefits Agency.
This means that by placing the compensation sum into such a trust, eligibility for income support, housing benefit and ancillary benefits can be preserved. This can have a massive impact on an individual’s finances over time.
Trusts can be complex and expensive to set up and run but at the same time, a PIT can bring significant benefits .
Every claimant’s requirements and expectations will be unique to their situation but it is clear that in most personal injury cases where compensation is likely to be sizeable, thought should be given to the validity of using a PIT.
Advice from suitably qualified legal and financial advisers should be sought ideally at the negotiation stage of the award process, but in any event at least before the award is settled.
