Do I need a personal injury trust fund?
If you are an adult who has received damages for personal injury or medical negligence a personal injury trust fund may be the best way to look after it.
One of the main benefits is that the damages are not considered for means-tested benefits. This means that you, your spouse and dependents can still claim benefits now or in the future.
Personal injury trusts may sometimes be an option for damages awarded to children who are still aged under 18. It would require a ruling by the Court of Protection. It is usual for settlements for children to be held in a Court Funds Account.
In the case of an adult who lacks mental capacity (the ability to make decisions for themselves), funds being looked after by a deputy are disregarded for means testing purposes too.
It is important to get expert advice around how best to look after damages payments before they are awarded to avoid costly mistakes.
If a personal injury fund is the best option for you, it is likely best to pay damages into it straight away. If they are paid into an existing account with other funds already in it, it can create complex issues over which funds are compensation funds.
What is a personal injury trust deed?
A trust deed sets out all the rules and obligations concerning a personal injury trust.
It must be prepared by a specialist solicitor and signed by the trustees.
If the person who is entitled to receive the personal injury award does not have the mental capacity to manage their affairs they cannot sign the necessary trust deed. Instead, they will require a deputy appointed by the Court of Protection to manage their affairs.