by John Darer® CLU ChFC MSSC RSP CLTC
'When a structured settlement is proposed by the defense that often means proposing a structured settlement offered by a (life) insurance company tied to the defense…', or so goes the myth.
Separating Facts from Myths about Structured Settlements
Here are the facts about Structured Settlements
- Life insurance companies do not offer structured settlements, they issue structured settlement annuities, through their appointed agents and brokers.
- The majority of Defendants do not own life insurance companies that issue structured settlement annuities
- The majority of life insurance companies do not offer structured settlement annuities.
- The majority of property and casualty insurers do not own a life insurance company that issues structured settlement annuities.
- Most structured settlement brokers are appointed with the same annuity companies "that are tied to the defense"
List of the life insurance companies that are the predominant issuers of structured settlement annuities, as qualified funding assets.
With respect to the exceptions:
- While Corebridge owns American General Life Insurance Company and United States Life Insurance Company in the City of New York and they maintain an approved list (that includes most structured settlement annuity issuers, when push comes to shove, the AIG owned life insurers are an option. Furthermore, most, but not all, structure firms whose representatives work with plaintiffs are appointed with these companies. [ For those that are not appointed with them, there may be a valid business reason for it. Why not ask them why?]
- While USAA owns its own life insurance company, they do not insist that all structures be written through USAA. Where USAA is very competitive they do not do a qualified assignment and both their life company and the P&C company have A++ratings from AM Best Aa1 Moodys and AA+ S&P.
- Where Berkshire Hathaway Group owns a number of insurers, a periodic payment reinsurer and several life companies that issue structured settlement annuities and they prefer to keep things in house, upon information and belief, they will also agree to New York Life when competitive. Berkshire Hathaway Life Insurance Company of Nebraska, National Indemnity Company and New York Life Insurance Company are all rated A++, by AM Best, the highest possible rating at time of posting. Moreover, for those that find this appealing, Berkshire Hathaway is one of the strongest fighters of factoring abuse among the structured settlement annuity issuers.
- Liberty Mutual Insurance Company has an approved list that includes most other structured annuity issuers. Liberty Mutual divested itself of its related company Liberty Life Assurance Company of Boston in 2018. Liberty Life became Lincoln LIfe Assurance Company of Boston in 2018. Protective lIfe now services the Lincoln Life (former Liberty Life, stuctured settlement block.
There are plenty of ways to market your settlement planning services other than spreading a myth.