A row is brewing between doctors' insurers and the government over the potential changes to lump sum payouts for medical negligence, which will be made official in a white paper set for release later this year.

A spokeswoman for the Lord Chancellor's Department (LCD) confirmed it was considering periodic payments as an alternative.

In its response to the government's consultation paper on periodical payments for future loss, released in March this year, the Medical Defence Union (MDU) suggested that structured settlements have more of an advantage.

Dr Frances Szekely, a senior medical claims handler at the MDU, said the union had "mapped out all eventualities", but preferred the idea of structured settlements, as opposed to periodic payments.

"Periodic payments are intensely bureaucratic and expensive to administrate," she said.

"Structured settlements would probably be better but we don't yet know the details of the white paper. If it has a good effect on the NHS, it will be good for us too."

The Association of British Insurers (ABI) is also supporting structured settlements and ABI deputy manager for liability Alistair Kinley said he would like to see this happen more broadly. "Socially, anything that reduces incidents of medical error and leads to better transparency and awareness has to be a good thing," he said.