by John Darer CLU ChFC MSSC RSP CLTC
Qualified Structured Settlements-> Qualified Assignment Company
A structured settlement abannuity is typically purchased as a “qualified funding asset” by a qualified assignment company that has assumed the liabiility to pay for perioidc payment of damages under a settylement agreement. The damages must arise out physical injury, physical sickness, workers’ compensation, or wrongful death survivior claims.
Non Qualified Structured Settlements-> Assignment Company via Non Qualified Assignment
If the structured settlement is for payment of damages from an employmnet settlement, a divorce settlement, a commercial dispute or to pay for taxable damages, then the annuity is typically owned by the non qualified assignment company.
In cases where a settlement is made with certain branches of the United States government there is no qualified assignment, the annuity is owned by the United States. There are also some insurers (and in rare cases defendats) who do not enter in to assignments. In those cases, the defendant or the insurer will own the structured settlement annuity.
Payee Does not Own Structured Settlement Annuity
Payee owns the contractual right to receive payments from the structured settlement
- In no case will the plaintiff own the structured settlement annuity.
- The plaintiff owns the right to receive payments from the structured settlement (“structured settlement payment rights” or ” structured settlement receivables”).
- Such rstructured settlement payment rightsights may be transferred provided they meet the criteria set forth in IRC 5891 and any applicable structured settlementprotection act.