How is a Minor Child’s Money Handled in a Personal Injury Settlement?


My daughter was a pedestrian that was hit by a car and suffered some serious injuries.  She is a minor.  I want to bring a claim or lawsuit against the responsible party.  But I was told that the money would be placed in an account set up by the court until she is eighteen years old.  Is that true?  Can I get the money out earlier if I need it?

Robert’s Answer:  

For the most part, that is correct.  Whenever a minor is involved in a personal injury case, the claims are basically divided into two parts.  The first part are the claims that actually belong to the minor’s parents or legal guardians in their individual capacity.  One example would be the medical bills.  The parent may sue for recovery of the medical expense of their child because, under Texas law, a parent is responsible for maintaining the health of their child while the child is a minor.  So, if a minor child is injured due to someone else’s negligence and needs medical treatment, then the claim for those medical bills belongs to the parent of the minor child.  This would also go for the attorney’s fees and case expenses if the parent chooses to hire a personal injury attorney.

The second part of the minor’s claim includes those damages that are personal to the child.  Common examples would be pain and suffering, physical impairment, mental anguish, disfigurement, etc.  These claims belong to the child.  However, under Texas law, a minor cannot bring a lawsuit individually.  They can only do so after they turn 18 or are otherwise emancipated.  But a parent can act as the personal representative of the minor child and bring those claims on the child’s behalf.  This means the parent would be acting as the “next friend” of the child.

That is why you see personal injury lawsuits involving minor children styled like this: “John Doe, Individually, and as Next Friend of Jane Doe, a minor….”  John Doe is bringing suit for his own individual claims as the child’s parent, such as the medical bills.  And John Doe is also bringing suit as “Next Friend” of his minor child for the child’s claims.

If their is a settlement or award of any money in the case, the funds are divided.  One portion is allocated for the medical expenses and any attorney’s fees and cases expenses.  The remainder is allocated for the child.  However, the court needs to protect that money for the child.  Likewise, the child’s portion is put into a trust account maintained by the court where it will gain a certain rate of interest.  When the child turns 18 or is otherwise declared an adult, the money is released to the child.

The parent may petition the court for early release of some or all of the money.  However, the Court will only agree to do so if the court feels like it is in the best interest of the child.  Normally, the court will not allow the parent to have any of the money for the parent’s own financial reasons.  This is because the court views the money as compensation that belongs to the child and not for the financial benefit of the parent.


74 thoughts on “How is a Minor Child’s Money Handled in a Personal Injury Settlement?”

  1. My son and I was In a car wreck due to a drunk driver head on about 9 yrs ago. I got my part of the settlement but my son at the time was only 1 month and banged his head up pretty badly. I was told at the time that they were going to put my son part of the settlement in a trust fund. How can i go about trying recover it.

    1. Thank you for your comment. Unfortunately, it is highly unlikely that you will be allowed to recover any part of that money. A court will only allow it under very limited and exigent circumstances. Rather, your son can recover it when he turns eighteen (or is otherwise emancipated).

      1. Brittany Dressler

        I’m supposed to receive 15k on my 18th birthday which is in 6 days. Although, my mother, for years, has been saying that it’s all up to her whether I get the money on my birthday or not. She claims that she has the option to hold off until graduation. Is this legal? She tells me that she’ll never let me see the money if I don’t have a 4.0. Gpa. I’m planning on using some of the money for a car, so it’s really important to me that I get it on my birthday. She thinks just how any parent would think, that I’m just going to fly through the money as soon as I get it when in reality I already plan on seeing a financial advisor so I can save.

        1. The court’s order is what dictates when and how the money is paid out. As a general matter, most of the time the order simply states that you are entitled to get the money on your 18th birthday. If that is the case, then legally speaking, the money is yours to do with what you wish. That is my advice on the law. Unfortunately, I cannot give you advice on maintaining harmony with your mother. That’s a whole different matter which only you know how to handle. But I am sure she has your best interests at heart. You might want to listen to what she has to say. Good luck and “Happy Birthday!!!”

  2. My son was hit by a car in the bronx ny. It was a hit n run. I was told that because the driver was never caught, I could not sue my own insurance company. I filed a claim myself but now that I am just waiting for them to open my son’s trust account, they are saying that is a rare case because they cannot put the money in a regular account trust, that it needs to be a “Medicare trust account t” which I am not familiar with and don’t know what it means. What is that type of account and are they telling me the truth?

    1. Thank you for your comment. Unfortunately, I am unable to speak on your situation. I am a personal injury lawyer in Dallas, Texas. I am not familiar with the laws and rules in your state. You will need to consult with an attorney in the state where you reside or where the accident occurred.

  3. Patti S Benjamin

    My granddaughter received a settlement in a trust fund after an accident as a child. She is 18 now and wants to collect her money. Does she go to the courts or through the attorney her mother had at the time?

    1. Generally, it’s as easy as going to the court clerk’s office and presenting identification. There may be some forms to fill out. But the original court order probably provided for the clerk to release the money to the child once she presents proper proof of her age.

  4. Hello my son has a settelment and i was displaced (homeless) just recently got a place,can i ask the judge for money for bedding and a computer for my son? Do you think the judge will grant me some,im low income and cant afford a bed for my son,im really finacially hurt at the moment

    1. It depends on how much money you are requesting, the reason for the money, and the judge. Most judges will not allow it, especially if it cuts deeply into the child’s money. But if it’s a relatively small amount compared the the total fund, and the judge believes the money is needed for the “best interests of the child,” they may allow it.

  5. Hello, I was hit by an 18 wheeler in Grand Prairie, TX. Fortunately, there were no major physical damages, just some scuff marks on the passenger side of my car and the rear view mirror was damaged. However, my nerves are shot. It was terrifying watching that huge trailer coming at me. Is there some kind of compensation for that experience? I don’t know much about accidents and the type of compensation you can receive. Thank you!

    1. Thank you for your comment and question. Unfortunately, Texas does not recognize claims solely for mental anguish. There has to be some corresponding physical injury involved. The only time mental anguish can be recovered on its own is if the wrongful conduct was done intentionally.

  6. I am currently looking into a huge settlement from a vehicle injury. Is it possible for me to put my settlement money into a family members account who I Live with, instead of a trust as I am under 18?

    I would be looking into using this for a car and a house, is this possible to accomplish?

    1. It’s possible, especially if you were going to be 18 very soon. However, the judge is going to be very concerned about whether the money is protected until you are 18. All you can do is discuss the matter with the guardian ad litem and maybe you can work something out.

  7. Tammy Langenberg

    My 15 yr old son has an IQ of 57. I was told the money he’s getting from a car wreck settlement will be put into an account till he’s 18. I feel this is unfair as he won’t be getting a car, and he will have to live with us anyways after 18. What can I do to get his money sooner for him?

    1. Has the settlement already been finalized and paid? If not, then you might be able to talk to the “guardian ad litem.” This is an attorney appointed by the court to review the settlement. You might ask the GAL to back your request to take some of the money to buy a car for the child. Maybe the GAL will agree and make the recommendation to the court. However, it’s ultimately the court’s decision on what is in the best interest of the child.

  8. Hello. I adopted a child from cps. She is supposed to have a trust fund due to a car accident when she was 4 yo. We have no information on which court handled her settlement and no contact with bio. Family. How can she get a hold of her monies once she is 18?

    1. There are a lot of ways to find out. When the settlement was approved, it was done through a court process. There would have been a hearing and the judge would have signed an order. If you know what county the court proceedings were in, then you can call the court clerk and they can try to find the case information through a name search. Another way would be to call the attorney who represented the child for the injury claim as well as the insurance company that paid the settlement. It’s hard to answer this question without knowing what process your specific case involved and what information you may have available.

  9. Pingback: 5 Things to Know About Your Child’s Personal Injury Case – Dana Sibilsky

  10. I was in a car accident when I was 3 years old, the state then suited the party that hit my family, I was granted a settlement which was placed into a trust fund, I am now 18, and since I have been 18 my parents have been contacting the courts, recieving a document removing the conservatorship, and my mom has added herself to the account where my money is placed, and she is now telling me that the Judge has ordered that she be in a joint bank account with me, but there is no proof of this? Now I can not receive my check without her being on my account with me and we both signing and I am supposed to split my money with my parents, but I am afraid They will take it upon themselves to get the check before I do, and decide how the money is shared. Is any of this legal?

    1. You mentioned something about a conservatorship. Are you saying that your parents have applied and were granted conservatorship over you? On what grounds? Anyway, now that you are 18, you are considered an adult and the money must be released to you unless there has been some intervening legal measures taken by your parents to maintain guardianship over you. If this happened, you may have to talk to a family law attorney.

  11. My 9 year old g’son is receiving a $20,000 personal injury settlement. The attorney thinks it should be put it in an annuity account. In this annuity design, when he is of age, the annuity would give him payments over 4 years. Being that it is only $20,000, I don’t agree that this is the best route. I think a regular Trust Account, where he can have access to the money at 18, is sufficient.

    What is your opinion?

    1. I tend to agree with the attorney. It would be smart to have that money paid out over time. Not only will the annuity yield a higher return, you can also avoid putting a large lump-sum of money into the hand of an 18 year-old. Even though 18 is the age of adulthood, they still may not have the maturity to properly use that money. This way, the money can be paid and used to help with each of his 4 years of college.

  12. Ivan gabrielson

    Is it possible to avoid a child trust fund from an auto accident or have a smaller portions set and dispense the difference out of court. By incouraging the insurance company to settle out of court and save half. Literally hundreds of thousands of dollars.

    1. It’s not the insurance company that you have to convince. It’s the court appointed attorney and the judge that have to agree to your proposal. But, I will say that the courts are very reluctant to take the money away from the benefit of the injured child. I have seen some very specific and unique circumstances where the court allowed the minor settlement to be used by, or placed under the control of, the parent. Ultimately, the court is going to do what is in the best interest of the child. Normally that means the money is placed into a trust account and saved for the child once reaching the age of adulthood.

    2. Is it possible collect for pain and suffering as anadult for a case that happend as a minor but never was collected or paid? This was not for an auto injury it was for a victtim of a vioent crime

  13. Is it possible collect for pain and suffering as anadult for a case that happend as a minor but never was collected or paid?

    1. The simple answer is “yes.” A child’s claim for pain and suffering is valid up his/her 20th birthday. That is because a child’s claim is tolled until the child turns 18 or is otherwise emancipated (declared an adult). Therefore, the statute of limitations does not begin to run until the child reaches adulthood. However, there may be much more to consider when deciding whether to pursue a childhood personal injury claim.

  14. Hello I just turned 18 and my case was settled two years ago what do I do next ? Im sort of stuck. My lawyer never spoke to me about this stuff.

    1. If this was in Texas, then the final order should have a directive to the court clerk to pay you the money upon you turning 18 and showing proper identification. If the order does not make such a provision, then you have to file a motion with the court requesting that the money be released.

      1. The order does say for it to be released but the new judge said no an order needs to be filled is that right

  15. I remember as a minor being told that I was to receive a settlement at the age of 18 but nothing happened. I asked my mom once but got no answer. It was for a personal injury when I was 7 or 8. What can I do to find information to what happened?

    1. Do you remember where the accident happened? You might try searching the court records thete. Another thing you can do is try to get a copy of the police report. That would be a good place to start tracing your steps.

  16. It is May 30, 2018
    My daughter was hurt in a wreck in November of 2017. When I settled with the insurance company in the amount of $27k I was told it would be done by the end of the month, which was 2 months ago. They had the amounts of the bills and now are wanting me to resend everything so that they can pay the bills directly. Am I not able to collect the money and pay the bills myself since they are in my name? Everytime I turn around they are wanting me to do more work. I have sent them everything they have asked for and it just seems like they need more once I fulfill what they want….I have also asked for 3% of the settlement for self representation, being that I am doing all the leg work. Is that a heard of thing???Please help! Should I just go hire an attorney?

    1. They will want to pay the bills directly just to make sure that the bills are paid and that you do not pocket some or all the money. Otherwise, the Court will want that money to go to the child’s portion. As for 3% for your work, the Court will not approve that since you are not a licensed attorney. My recommendation would be to call all the healthcare providers and try to work out settlements/reductions on their bills. If you able to make such agreements, get them to send you revised billing statements showing their reduction and submit those for payment upon approval of the settlement. This way, more money will go to the child than to the doctors. Most healthcare providers will negotiate their bills.

  17. My four children were injured in a single car accident caused by myself due to engine problems. We have not settled but I live in Texas and was told it would go into a trust If the settlement is over 5000.00. Is this true??

    1. There really isn’t any minimum threshold for the settlement to be placed into the court trust account. In a minor’s personal injury settlement, it is completely within the discretion of the insurance company whether not they want to go through the court process to approve the settlement. The benefit they get from that is the settlement would be binding on the child after the child turns 18. However, if the settlement is relatively small, the insurance company may not want to spend the time and money on the court approval process. It’s really their decision.

  18. Having a question is it legal for the attorney to put money under his trust and me as a client not having any details of the trust, when we ask him he says he will draft something that we having money in his own trust.

  19. is it legal for the attorney to put money under his trust and me as a client not having any details of the trust, when we ask him he says he will draft something that we having money in his own trust.

  20. My daughter received a settlement a few years ago and the money is in a CD in a savings bank that gains interest until she turns 18. She is now 13. I am her sole provider. Unfortunately, I had spinal fusion surgery in April that went horribly wrong with one of the screws during fusion was inserted on my L5 nerve and a spinal column tear. This error resulted with horrific back pain and foot drop. I am unable to work and I have applied for disability benefits. This entire situation has impacted my quality of life. Waiting for SSDI benefit approval is a long time and I have very little money left with no replenishing income. Would the court allow me to withdraw some money for financial to help support my daughter since I have hardly any income? I would need financial help through November which is about the time Social Security mentioned I should have a response from them.

    Thank you.

    1. It is really in the discretion of the judge. Most of the time, a judge will not allow a minor’s money to be used because of the financial hardships of the parents. Of course, your situation may be different since it is an unforeseen circumstance. You will need to either call the previous attorney or contact and new attorney who will file a motion with the Court that first approved the settlement. Ultimately, the judge is going to do whatever is in the “best interests of the child.”

  21. The order does say for it to be released but the new judge said no an order needs to be filled is that right

  22. At age12 . I was hit by a vehicle while riding my bicycle. I was in the hospital for 2 weeks for a concusion. I recieved a insurance settlement in Orange County California.I could not touch the finances until age18. It’s been 36 years and I have not claimed any of the insurance funds. Would you please help me locate this income?

    1. The first thing I would do is contact the clerk of the court where the settlement was finalized. Give them your name or your parent’s name under which the case was filed. Have them look it up for you and give you a case number. Then, ask them what you need to do to claim the money. Otherwise, you need to retain an attorney in California for this.

      1. My situation is similar but i have no way of knowing where the settlement was finalized. My mother has no recollection and I can’t even trace down the accident report. I was hit by a car when i was 4. My mother said it was with the drivers insurance company and that it was a red brick building and that’s all that she can remember, any paper trail has been lost due to her negligence

  23. So my dad sued the police department of my city because they broke my wrist, this was when I was 16. I am now 17 about to turn 18 when that happens is the money available to me or do I have to wait till 21?

  24. I know someone whose minor son was involved in an accident that left him possibly paralyzed for life. The son was rewarded a large sum of money recently and obviously the assets are with a “guardian” of the trust. Now the father of the son, who is working as a financial planner, is asking the guardian to allow him or his brother-in-law, who is also a financial planner, to allow them to actually manage the trust assets for the minor. First of all, is this even legal? Wouldn’t that be considered a huge conflict of interest? Would the state where the lawsuit was settled ever allow something like this to happen?

    1. I do not know what state you are talking about. But, for personal injury cases in Dallas and the rest of Texas, a judge would have to approve such an arrangement.

  25. Hello, My duaghter was hit by a car recently and has sustained fairly serious injuries. My lawyer says that all of the money is going to go into a trust for her when she’s 18. That I love and agree with, however the money that we have to pay now i.e missing work, bills not completely covered by insurance, etc, is adding up. Im told that there is a slim chance that we could be compensated for that even though we have documented all of this. When we go to court to finally complete this, would we be able to request this and ONLY this money back? If so how would you go about it?

    1. The court might let you take some of the money to pay the balances on the related medical expenses. I doubt they will let you take money for your lost wages. As a personal injury lawyer in Dallas, the courts here try to protect the minor’s funds as much as possible.

  26. My daughter is set to get a injury claim and I’m just curious as to what kind of things would get approved for the use of some of the money before she turns 18? As she was injured on public transportation would they circumstance my fear of not wanting to use it anymore and maybe let me get a car for her safety mostly? I mean her not being able to be in a seat belt is what caused this injury In the first place!

    1. I highly doubt it. Courts are very protective of a minor’s settlement. At least, that has been my experience with Dallas personal injury cases in the past. I’d recommend you take this up with your lawyer.

  27. I was recently in an 18 wheeler accident with my family and I’m only 17. I wanted to know if that the money I get for the settlement can my mom touch my money or is it put up for me until I turn 18 or can she take my money for herself. Is the money combined together and will the judge or lawyers tell how much I’m getting.

    1. If the insurance company is settling your injury case through a court “prove-up” proceeding, then the money is held in trust for you. No one can touch it. You can proceed to claim it once you turn 18. Also, the court will appoint a “guardian ad-litem” to review the settlement strictly on your behalf. The GAL will advise you on all aspects of the settlement details. Remember, the GAL is there for your benefit and protection.

  28. Question: what happens if the parent of the minor refuses to show up for the court hearing and refuses to sign papers or agree to the way they are handling the minor’s money? Will the hearing still take place and happen or will his money get forfeited?

    1. That’s a good question. I have never had that come up in a minor’s settlement before. I guess it depends on why the parent is objecting to the settlement. If the parent has good grounds, such as the settlement is not enough to cover the minor’s injuries, then the Court might not approve the settlement. But, if the parent is objecting because the money is not coming to them, then the Court may approve the settlement anyway based upon the ad-litem’s recommendations.

  29. When I was 15 i was involved in a serious accident which left me disabled for several years along with periods of hospitalizations and cross state doctor’s visits. Being in no position to think about money or insurance related matters my parents took care of everything as far as I know. I was told eventually (around maybe 16) that there was some insurance money, but no further details such as how much, accounts, etc. Is there a way I can find out the details from my accident and any information on the insurance? My parents refuse to discuss anything about it and at the very least I’d like to know what went where and to whom. My initial thought was that they used it to pay my medical bills and help in my recovery, but from what I’ve researched it’s not quite so simple usually.

    1. Was your injury case in Texas? If so, you probably need to call me. There is more information I would need to get in order to point you in the right direction. Messaging is not the most efficient way to handle this.

  30. My daughter ingested chemicals at daycare on 6/17 at age 3 from an improperly prepared arts and crafts project. She just had surgery after over a year of outpatient procedures where they removed a portion of her esophagus that had been damaged by the chemical burns and resulting scar tissue. Our lawyer has told us that he doesn’t want to add the franchisor to the case as it will only complicate things when trying to prove responsibility with them. Does this sound correct? The daycare has a $3,000,000 policy and thats what we are asking for. My daughter will have medical bills for years to come as she will have to have routine check ups and possible esphogial dilations to open her esophagus at the connection point in her esophagus that was made by the surgery. Her esophagus strictures at the connection site making it difficult to impossible for her to swallow food. My lawyer told me today that the insurance is willing to settle if we release the franchisor and franchisees from the suit. My questions are what benefit will releasing all parties have? This case is pretty clear cut and dry, not much to argue from a defense standpoint. Will we be able to access money after settlement to pay for recurring medical expenses since in the state of Texas we are entitled to reimbursement for those expenses? We will be able to access the interest money that is accrued from the settlement? This is a Texas lawsuit.

    1. Never think that a case is clear cut. Ask any attorney: There is no such thing as a “cut and dry” case. With that said, the benefit to signing a release is that your get finality to the claim as well as predictability. Unless you are willing to sign a release, then there will be no money. Therefore, you have to rely on a jury to give your everything you want. That is not the smart play especially if you have the opportunity to resolve the case for a significant amount of money.

  31. My daughter fell off a truck and I filed a lawsuit against the other party the insurance settled. My question is isn’t it true that my attorney could have filed a lawsuit on my behalf and one on her behalf? I lost 6 months worth of work due to her accident and recovery

  32. My daughter fell off a truck and I filed a lawsuit against the other party the insurance settled. My question is isn’t it true that my attorney could have filed a lawsuit on my behalf and one on her and one for me I lost 6 months worth of work due to her accident and recovery

    1. It just depends on the arrangement you had with the attorney. Generally speaking, the attorney will file suit for the parent’s individual claims (such as medical bills, lost wages, etc) as well as the child’s claims (pain and suffering, mental anguish, disfigurement, impairment, etc). Another issue is whether there is going to be enough money to go around. This depends on the available policy limits of the claim.

  33. Hello, I was in a car accident with my son. Which the other person/car was at fault. Now I’m suing his insurance company for injuries for myself and my son. My lawyer ask me to get my son’s father to write a letter stating if any money awarded to my son he has no rights to the money. When writing this letter what he needs to be written?

  34. Can a settlement check for a child under 18 be issued in their parents name if given permission by the child.

    1. It’s not the child’s decision. It all depends on what the insurance company is willing to do. If the insurance company is requesting court approval of the settlement, then the guardian ad-litem and judge will have to approve such an arrangement.

  35. I was in a accident with my minor daughter. I was at fault and she was injured. I settled with the insurance company for $1400.00. $750.00 was for medical bills and $650.00 was for liability. They want me to sign the form Release In Full Of All Claims without including the $650.00 for liability. They said she has to file that claim when she turns 18 and that’s why they cannot put it on the form. They said they will pay the medical bill after I sign the form and then send me a check for the liability payment for my convenience. That doesn’t make sense to me. If that’s the case, why did they settle for $1400.00? And how do I know that they will keep their end of the bargain and send me the check for $650.00 if it’s not in writing?

  36. My son was hurt at a motel in the state of California a sink fell through on him the insurance has contacted us to settle and we agreed on the amount but now they are saying that we cannot touch the money until my son is 18 but he just turned five we were staying at the motel due to homelessness when the accident occurred they kicked us out of the motel and said we couldn’t come back that was the only affordable place we could stay being it was a extended stay. Now because of the incident we have to pay way more which we cannot afford and are facing being on the streets is there any way that we can get the judge to Grant us some of that money to get a place and stability for my child.

  37. Live in Tennessee, my daughter received a lawsuit, back in 2013 from a school bus wreck. They received a settlement! my lawyer told me that the money would draw interest until they turned 18, so I was under the impression that they would receive that interest once they were 18. Now that I understand what IOLTA trust account is, I am a little confused at why the lawyer would tell me that. I am now trying to see if there is any way that I could get that settlement moved to another account where they could at least draw interest.

    1. You are mixing apples and oranges. When the court approves a minor settlement, the judge usually orders that the money be placed in an interest-bearing account or other investment annuity. Interest earned on the money is paid to the minor when the money is subject to being withdrawn. An IOLTA account is completely different. That is just a bank account that the attorney maintains in order to handle client funds prior to final disbursement.

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