Berkshire Hathaway Structured Settlements Dual Guarantee
John Darer • January 16, 2020
Unmatched Two Company Guarantee on Large Cases
Berkshire Hathaway has an appetite to write structured settlement annuities to fund long term needs. Whether that be a cash flow that starts right away and payable for 50 years certain, or one that is deferred for quite some time before payments start, there is a very good chance that a Berkshire Hathaway company will be highly competitive.
Berkshire Hathaway Annuity Issuers for Structured Settlement Annuities
Berkshire Hathaway underwrites structured settlement annuities through Berkshire Hathaway Life Insurance Company of Nebraska (BHLN) and in New York, through First Berkshire Hathaway Life Insurance Company (FBHL). In addition National Indemnity Company issues periodic payment reinsurance.
How it works
- A periodic payment obligation is established in the Settlement Agreement, obligating the Defendant or Defendant's insurer(s) to make structured settlement payments to the Plaintiff, or to a trust for the benefit of the Plaintiff.
- The obligation to make the structured settlement payments is assigned, by way of a qualified assignment, to BHG Structured Settlements, Inc. (BHGSS).
- BHGSS funds its obligation through the purchase of an annuity from either BHLN or FBHL, if it's a New York structured settlement.
- BHGSS' obligation to make the structured settlement payments is, in turn, guaranteed by Columbia Insurance Company, which as of 12/31/2018 had $19.2 Billion in Statutory Surplus. Financial Ratings of A++ A.M. Best AA+ Standard & Poors.
- For structured settlements funded with $3 million or more in premium to BHLN, there is a dual guaranty, with National Indemnity Company being the dual guarantor. As of 12/31/2018, National Indemnity had Admitted Assets of $228.2 billion and Statutory Surplus of $122.5 billion. Financial Ratings of A++ by A.M. Best and AA+ by Standard & Poors
"Measured by net premium written, the largest U.S. reinsurer by far was National Indemnity Co., a unit of Berkshire Hathaway Inc., which reported $19.33 billion in premium", Gavin Souter, Business Insurance November 25, 2019, citing a report by the Reinsurance Association of America.
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A structured settlement annuity does not drive the tax consequences of structured settlement annuity payments. It is the type of damages the structured settlement annuity payments represent, as reflected in the relevant settlement documentation executed by the settling parties
Structured settlement beneficiary death claim. An executor cannot change the beneficiary of a structured settlement annuity. StructuredTypically, settlement agreements permit the Payee to name or change a beneficiary, provided such change is in writing and submitted to the Assigmment Company or annuity issuer in writing and in proper form.
