If you paid the premiums out of pocket (after tax) then the settlement is not taxable unless it is more than the premiums you paid.
If you paid pre-tax premiums (such as workplace medical insurance) then the check is taxable income because it is a return of money you didn't pay tax on before.
If you paid premiums out of pocket and then claimed a tax deduction as a medical expense or used an HSA to pay the premiums (maybe for long term health insurance), the check may be taxable as a return of a previous tax deduction, but we would need more information.
