Net Growth Rate Phenomenon Not the Factor It Was
Periodic Payment of Judgments Act Has Been Used as Negotiating Tool
For almost 15 years ending in 2022, savvy New York plaintiff lawyers with good liability cases, who were not fearful of the inside of a courtroom, enjoyed a distinct advantage using a negotiating tool that follows the statutory guidelines of CPLR 50A or CPLR 50B and relevant case law.
The statutory growth rate used in the calculations since the mid-1980s, when discount rates were more than double that, is fixed at 4%, but the discount rates were below that for more than a decade and well below that from the start of the Covid-19 pandemic until 2022.
The result was a net growth rate and the phenomenon, that was shocking for some, was a net present value that then often exceeded the verdict!
Where we are now?
The inversion has been eliminated when the yield on the 30 Year T Bond is 4.88%, they yield 20 year Treasury is at 4.83%, the 10 year is at 4.28%, the 5 year at 3.8% and the 2 year at 3.72% .
How Long Have Retained Asset Accounts Been Available?
Since 1984. As a former Northwestern Mutual agent I vividly recall when the company introduced its Access account in the late 1980s. NML gave a check book to the beneficiary, then with up to $25,000 against the policy proceeds so that the beneficiary could pay for funeral costs and other immediate expenses without the undue emotional pressure that comes with financial planning during a life transition. It buys time.
Single A corporates drive annuity rates, which are significantly higher on the longer durations. If the case has bifurcated damages, or a pending New York wrongful death case with a date of death prior to 2022, there may still be some leverage if one considers the cost to fund a projected periodic payment judgment (with annuities to fund the remaining future damages on the day the judgment is paid.
That being said, structured settlements today provide and excellent value to plaintiffs and their clients and the favorable costs may make it easier to bridge gaps and settle cases.
Last updated August 14, 2025
