You Have a Structured Settlement

  • By John Darer
  • 14 Dec, 2017
I Have a Structured Settlement

What Do You Need to Do Now?

If you have  a structured settlement you don't need to do  anything now, never mind pay attention to the endless mailings and telephone solicitations of companies that offer you a discounted amount of cash for your structured settlement payments.  Unless you really have a need that cannot be satisfied from other sources and you have a plan,  just enjoy your structure. Enjoy the steady income, free of taxes if paying for damages for physical injury, wrongful death or workers compensation.

Those companies see your structured settlements as valuable so they chase people and give them cents on the dollar, some using unscrupulous and predatory methods.

4structures® Blog

By John Darer 12 Jan, 2018

Which New York licensed life insurance companies write structured settlement annuities in Bronx, Brooklyn (Kings), Queens, Staten Island (Richmond) and New York (Manhattan), Nassau, Suffolk, Westchester, Orange, Putnam and Rockland Counties in 2017?

The following companies issue structured settlement annuitiesto help fund New York City area settlements for personal injury, medical malpractice, wrongful death, auto accident and workers compensation settlements and to fund structured medicare set asides in 2017.

  1. First Berkshire Hathway Life Insurance Company Home Office:Flushing, NY
  2. Liberty Life Assurance Company of Boston Home Office:Boston, MA
  3. Metropolitan Life Insurance Company   Home Office:New York, NY
  4. Metropolitan Tower Life Insurance Company Home Office: Wilmington, DE
  5. New York Life Insurance Company Home Office:New York, NY
  6. Pacific Life and Annuity Company   Home Office: Newport Beach, CA
  7. The Prudential Insurance Company of America Home Office:Newark, NJ
  8. United States Life Insurance Company in The City of New York Home Office:New York, NY
  9. USAA Life Insurance Company Home Office: San Antonio, TX

Cases in surrounding counties such as Fairfield County, CT and Bergen County , NJ would substitute, Berkshire Hathaway Life Insurance Company of Nebraska, Pacific Life Insurance Company and American General Life Insurance Company for numbers 1, 6 and 8 respectively. Please note that a limited number of insurance companies underwrite structured settlements compared to other types of annuities.

For New York cases that go to a structured judgment, pursuant to NY CPLR Article 50A or Article 50B, the following of the above structured settlement annuity issuers will write annuities to fund structured judgments:
  1. Metropolitan Life Insurance Company
  2. Pacific Life and Annuity Company
  3. United States Life Insurance Company in The City of New York

The onerous acceleration provision for late payments in Articles 50A and 50B is the primary reason for why only two carriers write structured judgment annuities in New York.

Periodic Payment Reinsurance is available through National Indemnity Company (Berkshire Hathaway)

Structured settlement annuities are only offered through appointed structured settlement managing general agencies by their insurance licensed employees, or through affiliated insurance licensed independent agents and brokers.

Current as of January 12, 2018

Note that structured settlements can also be funded with United States Treasury Obligations

Need a Structured Settlement Quote now?

Structured Settlement quote form online. Click leftor call 888-325-8640toll-free for New York structured settlement quotes, employment structured settlement quotes, divorce structured settlement quotes, periodic payment reinsurance structured sales quotes for business installment sales and real estate installment

New York Structured Settlements

By John Darer 27 Dec, 2017

What is Destructive Receipt?

If a General Release has been signed and delivered to the defendant's legal representative, the tax benefits of a structured settlement may be lost. The ramifications may be costly for both the plaintiff his or her lawyers. Constructive Receipt is "destructive receipt" from a financial standpoint.

Why Would a Standard General Release Be Fatal to a Structured Settlement?

A standard general release fails to satisfy the requirements to establish a structured settlement,because of the fatal words "receipt of which is hereby acknowledged". Even though money has not yet changed hands constructive receipt has occurred. Where constructive receipt has occurred in a case involving taxable damages such as an employment or commercial damage case, there is potential for tremendous tax exposure that could have been easily avoided and a potential malpractice exposure for the attorney.

A promise to pay future periodic payments to establish a periodic payment obligation is a critical component to establish a structured settlement, regardless of whether the structured settlement is (1) qualified (medical malpractice, wrongful death, workers compensation, auto, product liability involving damages on account of personal physical injury or physical sickness); or (2) non qualified structured settlements (wrongful termination, harassment in the workplace, discrimination in workplace, intellectual property and other commercial claims .Even in mass torts where a qualified settlement fund has been established to aggregate settlement money in a big pot for claimants similarly situated, an obligation to pay on the part of the QSF is a critical component of the establishment of a structured settlement.

You may find this video, featuring LLC president John Darer on Constructive Receipt to be helpful 

Or simply call us at 888-325-8640

  • By John Darer 20 Dec, 2017
    New York will soon have a new structured annuity option to fund New York structured judgments. Pacific Life announced that it will begin writing structured annuities for New York CPLR 50A and 50B structured judgments in 2018, through its New York underwriting company, Pacific Life and Annuity Company.   Pacific Life is rated rated A+(Superior) by A.M. Best.

    What are New York CPLR Articles 50-A and 50-B?

    CPLR Articles 50-A and 50-B, are New York statutes that mandate future damages in excess of certain thresholds be paid in periodic payments. The statutes were established in 1985 and 1986 respectively and proscribe a method for calculating and paying damages in medical malpractice, dental and podiatric malpractice judgments (50-A) and other types of  tort liability cases (50-B) . 

    Pacific Life and Annuity is very strong on  period certain cash flows, especially short and intermediate term cash flows which is a good fit for certain elements of damages such as pain & suffering and lost wages.  Pacific Life  also underwrites medicals competitively.  Pacific Life will be no slouch on life contingent cash flows like future medicals.    

    CPLR Articles 50-A and 50-B cases are not for novices.  It's not as simple as buying an annuity.  There are many nuances and it's important to work with a settlement expert with knowledge of the statutes, relevant decisions and experience.

    CPLR 50A and 50 B Calculations and Utility to Parties in Mediation 

    Working with a competent settlement expert who can run net cost projections using varying elements of damages, who can "talk the talk" and "walk the walk", may be very helpful to parties at mediation to take numbers out of the abstract into reality and enable parties to explore the "what ifs?" in real time. 

    Other articles by John Darer on CPLR 50A and 50B related topics.

    By John Darer 14 Dec, 2017
    If you have  a structured settlement you don't need to do  anything now, never mind pay attention to the endless mailings and telephone solicitations of companies that offer you a discounted amount of cash for your structured settlement payments.  Unless you really have a need that cannot be satisfied from other sources and you have a plan,  just enjoy your structure. Enjoy the steady income, free of taxes if paying for damages for physical injury, wrongful death or workers compensation.

    Those companies see your structured settlements as valuable so they chase people and give them cents on the dollar, some using unscrupulous and predatory methods.
    By John Darer 11 Dec, 2017
    While there is a sumptuous buffet of structured settlement annuity companies and products available in the marketplace, few have the sumptuous ratings of Berkshire Hathaway structured settlement underwriting companies.

    Berkshire Hathaway Life Insurance Company of Nebraska (BHLN)    
    A++ (Superior)
    First Berkshire Hathaway Life Insurance Company (FBHL)       
    A+ (Superior)
    Columbia Insurance Company                                                                               
    A++ (Superior), guarantor of the qualified assignment company for allBerkshire Hathaway structured settlement annuities          
    National Indemnity Company 
     A++(Superior), periodic payment reinsurance , reinsurer of periodic payments                                                                                                                                             
    Speaking of 'Buffets", Warren Buffett recently punctuated Berkshire Hathaway's commitment to structured settlements by remarking  at the May 2017 Berkshire Hathaway annual meeting.
    "more people want to put their structured settlements with Berkshire Hathaway than anyone else",

    Buffet estimated that Berkshire takes in about $30 million every week in structured settlement premium. LLC offers structured settlement annuities issued by Berkshire Hathaway operating subsidiaries Berkshire Hathaway Life Insurance Company of Nebraska and First Berkshire Hathaway LIfe (on New York cases) and periodic payment reinsurance through National indemnity. For more information please contact John Darer CLU ChFC MSSC CeFT  RSP CLTC at 888-325-8640

    By John Darer 22 Nov, 2017
    What is indexed with Pacific Life ILAPA Rider on a Structured Settlement?
    The structured settlement payments are indexed, not the amount funding the indexed linked structured settlement

    What index are annuity payment adjustments linked to?
    The S&P 500

    How are payments adjusted when there are changes in the S&P 500 index?
    If there there is a year over year change in the S&P 500 between annual measuring points , then structured settlement payments increase by that percentage, up to a 5% cap.  If there is  a 3% increase in the S&P 500 between the annual measuring points, structured settlement paymnets increase by 3%. If there is a 15% increase in the S&P 500 between the annual measuring points, then payments increase by 5%, which is the cap on increases.  If there is a downward change in the S&P 500 between the annual measuring points then the payments remain at the then current level until the following year and the process continues.

    When is the ILAPA Rider best used?
    As an allocation on long duration structured settlements for plaintiffs and structured attorney fees.  It is not appropriate for a short duration structure.

    Illustrating Pacific LIfe's ILAPA Rider
    Given that the performance of an index is not certain the software provided by Pacific Life does not make forward hypothetical projections of how the product might perform for a prospective plaintiff annuitant.  Pacific Life has published an excellent informational brochure .   We have observed others in the structured settlement industry illustrating exemplar fixed percentage returns which are projected out 40,  50, 60 and 70 years. Such illustrations are highly misleading because the index never performs in a straight line. Even if one looks at a long term average for the S&P 500, it's still misleading to illustrate a level fixed COLA to project the performance of a structure with an ILAPA Rider.  One must take into account that in some years the return could be zero because there has been a downward change in the S&P 500 between the two annual measuring points.

    Learn more about index linked structured settlements through Resources Provided by LLC
    Help With Structured Settlements
    John Darer's video introduction to Pacific LIfe's ILAPA rider
    Index Linked Structured Settlement Payments Compared to Equity Index Annuity
    How Was Pacific Life Indexed Structured Settlement Annuity Affected by Market Crash?

    By John Darer 05 Nov, 2017

    A Financial Transitionist® is a professional with an established career in the financial services industry *who recognizes the importance and the power of the personal side of money and the unique challenges of transitions. Financial Transitionists® have a rich and comprehensive understanding of how people subjectively experience change, and are able to co-create their highest outcomes with them.  

    Financial Transitionists® bring process and tools to their client relationships that are not add-ons. Instead, they are intrinsic to the experience of guiding someone through a transition. Their work is embodied; it’s equal parts what they’re doing and how they’re doing it. And it requires a different kind of listening, a letting go of the seat of authority, and an ability to sit with and through uncertainty. It’s not for the average person and it’s not easy work, but it’s the most rewarding work all of us involved have ever done.

    John Darer is one of two settlement experts who have earned the Certified Financial Transitionist designation.

    By John Darer 02 Nov, 2017

    Independent Life Insurance Company, is a new structured settlement annuity issuer domiciled in Austin, Texas and is exclusively focused on providing annuities for the structured settlement market. As a newly formed and capitalized life insurance company, Independent Life does not have legacy structured settlement annuities on its books with pricing out of alignment with today’s low investment environment, factors which contributed to certain companies leaving the structured settlement marketplace in the last decade.  Independent Life is domiciled in Texas and is led by James D Atkins,  and several industry veterans.

    Atkins is the former CEO of Legal & General America. Prior to this position Atkins spent 25 years under the GE Financial Services umbrella (First Colony Life Insurance, GE Financial Assurance, and Genworth). During this time he acted in a variety of capacities including the roles of Chief Actuary and Capital Markets Leader. When he joined First Colony it was new in a fledgling structured settlement niche. During his tenure First Colony became one of the largest writers of structured settlement annuities. At its peak First Colony managed in excess of $10 Billion of Structured Settlement contracts.

    Independent Life pledges to provide ongoing financial support through grants that support structured settlement broker and settlement planner initiatives that promote the growth of the industry for the benefit of all stakeholders.

    By John Darer 02 Nov, 2017
    MetLife will begin offering a domestic non qualified assignment option in early 2018, through its Delaware based MetLife Assignment Company. The funding vehicle will be issued by Metropolitan Tower Life Insurance Company, currently rated A+ by A.M. Best and Aa3 Moodys.  Non qualified assignments (also known as non-qualified  structured settlements are a tax efficient way of settlement of taxable damages.  More details to follow as they  become known. Read about non qualified assignments.
    By John Darer 29 Oct, 2017

    Many sexual harassment settlements will be taxable, or have taxable elements. After paying attorney fees and applicable federal state and local income taxes, it could leave a third or less to the victim depending on their attorney's contingency fee agreement.  

    Sexual Harassment Damages | How to Mitigate the Tax

    For those with taxable damages, or with an element of taxable damages a non qualified structured settlement offers significant advantages.

    • Earn interest tax deferred.
    • Earn in interest on the deferred taxes tax deferred.
    • Earn interest on the interest tax deferred.

    If personal physical injury is an element of damages and qualifies within the meaning of IRC 104(a)(2), then that portion of the damages will be tax exempt. Please review our taxable equivalent yield chart to see the value of the structured settlement tax benefit.

    A structured settlement is  a negotiated stream or streams of period payments in exchange for a release of liability that are customized to meet a particular claimant's needs.  Most structured settlement in sexual harassment or other employment related settlements are funded with a structured settlement annuity or a trust fund that holds United States Treasury obligations.

    Share by: