by Structured Settlement Watchdog
Independent Life’s Reinsurance may be Mischaracterized by Settlement Planners
Imputing Reinsurer’s Rating is a Mischaracterization
- Despite the explicit message in the January 4, 2021, press release from Independent Life Insurance Company, the Structured Settlement Watchdog has noted that at least two settlement planners have misrepresented the nature of the reinsurance when soliciting clients and making submissions to judges in court-approved settlements, particularly when promoting Independent Life’s iStructure, the first uncapped index-linked structured settlement annuity in the industry.
- The misrepresentation involves an implication or even suggestions that the A+ rating from A.M. Best, awarded to Hannover, extends to Independent Life, or that the reinsurance serves as a form of financial guarantee actionable by the Independent Life consumer against the reinsurer.
- There is simply no excuse for any settlement planner to distort the facts that are clearly set forth in the Independent Life Insurance Company press release.
No Independent Life structured settlement annuitant has a direct action against the reinsurer
On January 4, 2021 Independent Life Insurance Company (“Independent Life”) announced in a press release that it entered into a reinsurance agreement with Hannover Life Reassurance Company of America (“Hannover Re US”), rated A+ by A.M. Best. In accordance with this agreement, effective October 1, 2020 Hannover Re US will reinsure a percentage of Independent Life’s in-force business and new business.
Independent Life remains 100% responsible for benefit payments to structured settlement payees
Hannover Re US will reimburse Independent Life for the reinsured portion of these payments.
The Key Word is ” Reimburse”
Reimburse means “The primary insurer and the reinsurance company enter into a contract called a reinsurance agreement. In this agreement, the reinsurance company agrees to reimburse the primary insurer for a portion of the claims paid out under the policies covered by the reinsurance policy. Source: InsurerGuru.com Reinsurance – What is Reinsurance? How it works? Definition, Type, Benefits, Process, Considerations, Challenges, Future Trends
Other References
Independent Life’s Reinsurance Agreement With Hannover Life Re (4structures.com) April 22, 2021.
Last updated December 13, 2024