Last updated February 26, 2026
By John Darer CLU ChFC MSSC CeFT RSP CLTC
✂️Why this still matters
More than a decade ago, I argued that structured‑settlement annuity issuers should take a page from the old Ginsu knife infomercials and learn to slice and dice—specifically, to split payment streams cleanly when an annuitant sells only a portion of their structured settlement annuity. That argument has aged unusually well. In fact, the risks I flagged in 2012 have only intensified.
The core problem remains simple: when a life company refuses to split payments, it hands control of the entire payment stream to a third‑party servicer, even when the annuitant sold only a sliver. That single administrative decision creates a cascade of avoidable harms—for the annuitant, for the insurer, and for the integrity of the structured‑settlement system.
🔪What happens when insurers refuse to “slice and dice”
🧩The predictable consequences
The consequences are not theoretical. They are predictable, repeatable, and now industrialized:
- The entire payment stream gets redirected to a servicer, even if only one payment or one year of payments was sold.
- The insurer loses direct contact with its own payee, forcing the annuitant to route every address change, bank update, or beneficiary question through a third party.
- The servicer gains a permanent data pipeline, which becomes a marketing engine for repeat factoring.
- The annuitant becomes a target, because the cheapest customer to acquire is the one who has already sold once.
- If the servicer fails, payments may be delayed or disrupted, and the insurer gets blamed anyway.
In 2012, this was a nuisance. In 2026, it’s a systemic vulnerability.
🪚The modern environment makes the Ginsu argument stronger
🧩Structural shifts since 2012
Several structural shifts have sharpened the blade:
- Private‑equity ownership has made both insurers and factoring companies more data‑driven and more aggressive.
- Servicing platforms have consolidated, meaning a handful of intermediaries now control thousands of payment streams.
- Remarketing is algorithmic, not manual. Once a servicer has the annuitant’s data, the targeting never stops.
- Regulators are paying attention, especially to opaque payment chains and consumer‑protection gaps.
- Reputational risk is higher, because a single servicing failure can go viral in hours.
The irony is unchanged: some of the same life companies that publicly decry factoring still refuse to split payments—thereby strengthening the very ecosystem they claim to oppose.
🧩The solution is still the same
🧩A simple, consumer‑protective policy
If issuers want to reduce factoring harm, protect annuitants, and maintain control of their own obligations, they should adopt a simple, consumer‑protective, system‑stabilizing policy:
- When an annuitant sells only part of their payments, split the stream.
- Send the sold portion to the buyer.
- Send the unsold portion directly to the annuitant.
- Keep the relationship intact.
- Eliminate unnecessary intermediaries.
- Reduce remarketing exposure.
- Protect the integrity of the structured‑settlement promise.
It’s not radical. It’s not complicated. It’s just good administration.
📉The Ginsu metaphor still fits
The old infomercial tagline—“But wait, there’s more!”—was meant as a joke. In structured settlements, it has become a warning.
When insurers refuse to slice cleanly, there is always “more”:
- More intermediaries.
- More data leakage.
- More remarketing.
- More risk.
- More consumer harm.
A simple administrative change would cut through all of it.
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