Is a Structured Settlement an Annuity?

John Darer • January 13, 2019

A Structured Settlement is Not An Annuity | What's With The Confusion?

A structured settlement is an annuity?

A structured settlement is not an annuity. A structured settlement is a way of settling a lawsuit using a combination of cash and customized stream (or streams) or future periodic payments. An annuity is one of the types of qualified funding assets for a structured settlement. Structured settlements can also be funded using obligations of the United States government. Future periodic payment obligations for many types of settlements where the paying party to the claim or litigation is insured may also be funded using reinsurance agreements (a/k/a "reinsurance structured settlements"). There are also other market based methods of funding future payment obligations for settlements that can be used for funding both qualified and non qualified structured settlements.

The structured settlement secondary market is notorious for providing misinformation about structured settlements to consumers. It's unreliable. The misinformation is mostly borne of the ignorance of the staff writers for structured settlement factoring companies or their marketing networks, their unwillingness to avail themselves of abundant research and their editorial and management's unwillingness to correct inaccuracies when they've been made aware of them. Here is an example of misinformation from a website called Annuity(dot)org that exists primarily to promote a single structured settlement factoring company called CBC Settlement Funding in Conshohocken, PA:

"A structured settlement is a type of annuity that pays out an award from a civil lawsuit by spreading the payments out over a long period of time". The Annuity(dot)org statement is not only inaccurate to say that a structured settlement is an annuity, but it's also inaccurate to say that a structured settlement pays out an award. A structured settlement is not an award. That's why a structured settlement includes the word "settlement". Otherwise it would be called a structured award, right?

.

By John Darer September 17, 2025
The Allure of "Convenience" is a Tax Trap . QSF Qualification is not a single moment in time, but rather a continuing obligation to operationalize all the requirements, as well as those required for creation.
qualifed assignment release and pledge agreement
By John Darer September 15, 2025
A Qualfied Assignment Release and Pledge Agreement (QARP) is a type of qualified assignment that gives a structured settlement payee a security interest in the qualified funding asset pursuant to the Uniform Commercial Code (UCC).
Indiiduals with Disabilities Education Act
By John Darer September 13, 2025
It bears remembering that, prior to 1975, children in the USA with intellectual disabilities, physical disabilities and even sensory disabilities were not guaranteed access to a public education.
structured settlement beneficiary
By John Darer CLU ChFC MSSC CeFT RSP CLTC September 12, 2025
"All payments From a Structured Settlement Are Guaranteed" ?
By John Darer September 6, 2025
Does a Structured Settlement Have a "Free Look" Period Like Other Insurance?
qualified settleent fund and QSF
By John Darer September 3, 2025
Invalidation of Structured Settlement Arrangements Under IRC § 130. If the QSF loses its status due to revocation/ termination of the governmental authority’s continuing jurisdiction, any structured settlement arrangements pursuant to IRC § 130 become null and void.
most infomative structured settlement websites
By John Darer August 26, 2025
The 4structures.com website is one of the most comprehensive structured settlement resources, particularly for those who want detailed, expert-level information, according to Google AI
most informative
By John Darer August 22, 2025
Based on Grok's review of prominent sites as of August 2025, 4structures.com (including its associated blog at structuredsettlements.typepad.com) stands out as the most comprehensive. Run by structured settlement expert John Darer, it offers detailed guides, and specialized insights
fountain
By John Darer August 17, 2025
Retained asset accounts for life insurance beneficaries, are temporary accounts that earn interest, give you time to breathe and give you time to figure it out.. Retained asset accounts are pay nterest from the date of death to date of settlement of the claim as a general practice,
knuckles
By John Darer August 16, 2025
How to avoid a "Knuckles Sandwich" when entering into settlement of claims or lawsuits involving taxable damages, or elements of taxable damages. What is the intent of the Payor? What happens if the intent of Payor is not clearly set forth in the settlement agreement?
More Posts