Igors Zunda, 33, died when Jurijs Zunda collided with a lorry on the A43 in Northamptonshire in 2012.
Igors's son, who was two years old, was confined to a wheelchair as a result of the crash, the High Court heard.
The undisclosed settlement for Igors' widow Marina Kruglova, 30, is to be paid by the Motor Insurers' Bureau.
The bureau is the body which compensates victims of uninsured motorists.
The Mazda 5 car, which had four passengers, collided with a DAF lorry at Duddington near Corby on 4 December 2012.
Another passenger, Jevgenijs Draguns was also killed, while Julija Vonfelfende was injured.
Jurijs Zunda was jailed for 18 months in 2013 after pleading guilty to a charge of causing death by driving while unlicensed, disqualified or uninsured and he has since returned to Latvia.
The terms of the settlement were not revealed in court.
Interim compensation payments had already been paid to allow Ms Kruglova to adapt her home for her son, who is now five years old.
She was living in Lincoln, but is now in Glenfield, Leicester.
Judge Gary Burrell QC expressed  his "admiration for her ability to come to terms with what has happened and to strive forward".

He was getting on the Sunmi on the River Thames at Gravesend Reach in Kent at about 18:10 BST on Wednesday when it happened, the PLA said.
Emergency services were called but were unable to save him, the authority said.
PLA chief executive Robin Mortimer said: "Our deepest condolences are with our colleague's family and friends at this very difficult time."
He added: ""We have been in touch with the family and are offering whatever support we can."
No details of the nature of the accident have been revealed by the PLA.
The authority and the Marine Accident Investigation Branch have started an investigation into the accident and will be attending the PLA's Gravesend base on Thursday.
A mother is to get compensation after her husband was killed and young son left paralysed in a car crash in which her brother-in-law was driving.
[NEXT_CONCEPT]
A Port of London Authority (PLA) river pilot has been killed in an accident while boarding a ship.