§ 25-1563.02.Lump-sum settlement; structured settlement; exempt from certain process; when.
Article 15: Execution, Exemptions, and Foreign Judgments · Last amended 1994 · Last verified July 22, 2026
In one sentenceThis section exempts lump-sum and structured-settlement proceeds paid as compensation for personal injuries or death from attachment, garnishment, and creditor claims, unless the beneficiary signed a written assignment or the funds are pursued for child support or by a county attorney under specific statutes.
Full Text of § 25-1563.02
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(1) Except as provided in subsection (2) of this section, all proceeds and benefits, including interest earned thereon, which are paid either in a lump sum or are accruing under any structured settlement providing periodic payments, which lump-sum settlement or periodic payments are made as compensation for personal injuries or death, shall be exempt from attachment, garnishment, or other legal or equitable process and from all claims of creditors of the beneficiary or the beneficiary's surviving dependents unless a written assignment to the contrary has been obtained by the claimant.
(2) All proceeds and benefits, including interest earned thereon, which are paid for personal injuries may be garnished by a county attorney or authorized attorney pursuant to section 43-512.03 or garnished for child support as defined in section 43-1705 by an obligee as defined in section 43-1713.
Section 25-1563.02 protects money paid to compensate someone for a personal injury or a wrongful death. All proceeds and benefits, including interest earned on them, whether paid as a lump sum or accruing through periodic payments under a structured settlement, are exempt from attachment, garnishment, and every other legal or equitable process, and from the claims of the beneficiary’s creditors or the creditors of the beneficiary’s surviving dependents.
That protection has two limits. It does not apply if the beneficiary has signed a written assignment agreeing to give up the exemption, since the statute protects the funds "unless a written assignment to the contrary has been obtained by the claimant." And personal-injury proceeds can still be garnished by a county attorney or authorized attorney under section 43-512.03, or garnished for child support by an obligee under sections 43-1705 and 43-1713.
The exemption recognizes that a personal-injury or wrongful-death settlement is meant to make an injured person, or a deceased person’s survivors, whole, not to become a new pool of assets for unrelated creditors to seize. The child-support carve-out reflects a separate policy: Nebraska treats child-support obligations as a priority that can reach even funds otherwise shielded from ordinary creditors.
Frequently Asked Questions
What money does section 25-1563.02 protect?
Proceeds and benefits, including interest, paid as compensation for personal injuries or death, whether received as a lump sum or paid out periodically under a structured settlement.
Can a beneficiary give up this exemption voluntarily?
Yes. The exemption does not apply if the beneficiary has signed a written assignment agreeing to make the funds available to a creditor.
Can these funds be garnished for child support?
Yes. Subsection (2) allows garnishment for child support, as defined in section 43-1705, by an obligee as defined in section 43-1713, and garnishment by a county attorney or authorized attorney under section 43-512.03.
Does this exemption cover proceeds paid to survivors after a wrongful death, or only to an injured living person?
Both. The statute protects proceeds and benefits paid to the beneficiary or to the beneficiary’s surviving dependents.
Does interest earned on a structured settlement lose its exempt status?
No. The statute specifically includes interest earned on the exempt proceeds and benefits within the protection.
Are all personal-injury settlements automatically exempt, with no exceptions?
No. The exemption yields to a written assignment by the claimant and to garnishment for child support or by a county attorney under the specific statutes the section names.
Source & verification. Section text and the amendment-history citation are
reproduced verbatim from the Nebraska Legislature, Revisor of Statutes, enacted by the
Nebraska Legislature. Last verified July 22, 2026. ·
Official source
Also known as:personal injury settlement exempt from creditorsstructured settlement exemption nebraskalump sum settlement protected from garnishmentchild support garnishment of settlement fundswrongful death proceeds exempt nebraska