When a child is injured due to someone else’s negligence, the emotional toll on families can be overwhelming. Amidst medical treatments, emotional recovery, and daily challenges, the legal process of seeking justice might seem like a daunting task. However, filing a personal injury claim on behalf of your child can help secure financial support for their medical expenses, ongoing care, and future needs. One important aspect parents or guardians must understand is how child injury claim settlements are managed and protected to ensure the funds truly benefit the injured child with the guidance of an experienced personal injury claim lawyer.
Who Can File a Claim for a Child Injury?
Since minors cannot file lawsuits on their own, a parent or legal guardian must initiate the injury claim on the child’s behalf. The law recognizes the unique vulnerability of children, which is why extra protections are in place during the legal process. This ensures that any settlement reached is fair, in the child’s best interest, and properly safeguarded.
Once a settlement is proposed or reached, it typically must be reviewed and approved by a court. This step is designed to prevent any party, including well-meaning parents or legal representatives, from misusing or prematurely accessing the child’s compensation.
Court Approval for Child Injury Settlements
Unlike standard personal injury settlements for adults, child injury claim settlements are not finalized by simply agreeing on a compensation amount. Courts play a key role in approving these settlements. After both parties reach an agreement, a petition must be filed to obtain court approval. This legal safeguard is mandatory in many states and ensures the settlement is just and appropriate for the child’s specific injuries and future needs.
The court will usually schedule a hearing to evaluate the terms of the settlement. During this hearing, the judge reviews medical records, statements from the parents or guardians, and opinions from the child’s attorney (if one is appointed). The judge may ask questions to ensure the agreement serves the child’s best interest and provides adequate financial protection.
How Are Settlement Funds Protected?
Once a settlement is approved, the next critical step is determining how the funds will be managed. Unlike adult injury claims, children’s settlements are often placed under restricted or protected financial arrangements. Here are a few common methods used to protect these funds:
1. Structured Settlements:
A structured settlement provides regular payments over time instead of a single lump sum. This is often used for larger settlements and helps ensure the child will have financial support as they grow older. These payments can be tailored to cover anticipated future expenses such as college tuition, medical care, or therapy. Structured settlements are managed through annuities and are often tax-free.
2. Court-Controlled Bank Accounts:
In some cases, the settlement money is deposited into a court-controlled bank account. Withdrawals from this account require court approval, which prevents misuse of the funds. This method is commonly used when the total settlement amount is modest and the child is expected to need the money once they turn 18.
3. Special Needs Trusts (SNTs):
If the child has a long-term disability due to the injury, the court may approve a special needs trust. This legal arrangement ensures that the child receives the care and services they need without disqualifying them from government assistance programs like Medicaid or Supplemental Security Income (SSI). Funds in an SNT can be used for a wide range of expenses not covered by public benefits, such as education, medical treatments, or assistive technology.
4. Custodial Accounts (UTMA/UGMA):
Under the Uniform Transfers to Minors Act or Uniform Gifts to Minors Act, the settlement can be placed in a custodial account. A custodian, usually a parent, manages the funds until the child reaches the age of majority. However, once the child comes of age, they gain full access to the account. This option offers less protection than a court-controlled or structured arrangement and is often avoided for large settlements.
Why Are These Protections Important?
These safeguards are not just bureaucratic steps—they serve a vital purpose. Children are often not mature enough to handle large sums of money, and there is always the risk of funds being mismanaged by adults, even unintentionally. By requiring court oversight and protective arrangements, the legal system works to ensure that the compensation awarded genuinely benefits the child both now and in the future.
In addition to preventing misuse, these protective mechanisms provide peace of mind to families. Knowing that your child’s financial future is secure allows parents to focus more on recovery and less on legal or financial stress.
Working With a Child Injury Lawyer
Navigating a child injury claim can be emotionally and legally complex. Working with an experienced child injury lawyer is essential to ensure the claim is properly filed, fairly negotiated, and that the resulting settlement is appropriately managed. A good attorney will guide families through each step of the process, from gathering evidence to presenting the settlement to the court for approval.
Your lawyer can also help you understand the best financial structure for your child’s future needs. Every case is unique, and what works for one family may not be suitable for another. Whether your child needs long-term medical care, psychological therapy, or simply future educational funds, a well-managed settlement can make a real difference in their recovery and well-being.
Final Thoughts
Settlements for child injury claims are more than just financial compensation—they are a commitment to the child’s future. With court oversight and legal protections in place, families can rest assured that the money awarded will be used wisely and fairly. Understanding how these settlements are managed empowers parents to make informed decisions that protect their child’s best interests for years to come.
