Whenever an individual annuitant, who is receiving periodic payments under a Structured settlement, desires to sell some or all of their future payments for a lump sum of money, the cash flows are sold at a discount in exchange for the lump sum payment. This discounted Structured Settlement is then available for sale to the Purchaser. This manner of securing the payment streams at a discount directly from the seller is how the Purchaser secures very favorable yields. This transaction is normally facilitated by a financial broker on behalf of the seller (or annuitant) and the purchaser.These structured settlements normally earn more than two times the yearly rates of Municipal or Corporate Bonds, Bank Issued Certificates of Deposit (CDs), or Government Issued Treasury Securities. Investors can certainly purchase an annuity directly from an insurance company, but these Direct Annuity Investments are backed by the same insurance companies as the Structured Settlements arranged by a broker, and they are typically originated with large sales charges or commissions, and offer substantially lower yields.The major benefits of purchasing these structured settlement annuities are:
1. Purchaser receives significantly higher yields than Purchaser can secure from comparable fixed rate investments.
2. Purchaser receives a fixed income over a defined period of time, based on the specific parameters of the purchased Structured Settlement.
3. Purchasers can aquire this asset to increase the yields in personal holdings, to maximize income at retirement, or to preserve principal for future years. They can be purchased by individuals, retirement plans, corporate entities, foundations, trusts, through investment clubs, or group investment accounts.
4. The Structured Settlement is backed or supported by annuity contracts issued by a rated insurance carrier. The insurance carrier that issued the annuity contract is state regulated and will generally have a Standard & Poors credit rating between A- through AAA.
5. Purchaser has control throughout the investment process; Purchaser receives assignment of the Structured Settlement payment rights directly from the seller through an approved court approval process, and the Purchaser receives the future cash flows directly from the rated insurance company that is obligated to make the payments. At no time during the lifecycle of the asset should the broker have possession, or control, of the Purchasers money.
Considerations of Purchasing from Annuitant
1. The transaction process facilitates a court order of the asset directly from the Seller to the Purchaser. The broker does not own the Structured Settlement payment rights, and should not receive, hold, or disburse any of the investors money. This is NOT a fund, and the Structured Settlement payments are made directly to the Purchaser from the insurance entity.
2. The security of the annuity is directly related to the claims paying ability of the insurance entity. The designation of an annuity as a claims paying obligation means that these obligations supersede obligations to bond holders, stock holders and other debtors. The insurance entities are required to hold capital to support these obligations as required by the applicable state insurance regulator. To date, a situation has not been reported where an insurance company rated A, or better, by Standard & Poors has defaulted on an annuity obligation that supported a structured settlement, and a concomitant loss has resulted to the payee. However, as the current financial markets illustrate, past history is not a guarantee of future results, and there could be future issues that arise relating to Structured Settlements that have not existed in the past.
3. Annuities, depending on the amounts owed, are partially or fully guaranteed by state insurance funds, and are designed to protect annuity holders from loss. This may provide an additional level of security to the potential Purchaser.
4. Structured Settlements are issued in U.S. dollars. Foreign Purchasers should consider the impact of exchange rates and U.S. withholding taxes on any potential investment.
5. A Structured Settlement may be less liquid than other investment options. The court order assigns the payment rights directly to the Purchaser or designee, and any future assignments may require an additional court order. There is no established secondary market for the resale of Structured Settlements and hence, Purchasers should be prepared to hold the Structured Settlements for the entire term.
6. In evaluating Structured Settlement payment rights, Purchasers should review the structure of, and support for, the payment rights. For example, some Structured Settlement payment rights are guaranteed by the related insurance company.
7. The Structured Settlement payment rights purchased may be all of the payments due to a Plaintiff or only a portion of the payment rights. Because the court will only approve a transaction that is in the best interests of the Plaintiff, in many instances, only a portion of the payments can be purchased since the purchase price for these limited payments will meet all of the Plaintiffs current needs. Because most state guaranty funds have dollar limits on the amount that they can be obligated to pay in respect to annuities and life insurance policies issued by insolvent insurance companies, Purchasers should be cognizant of the size of the underlying annuity that supports the Structured Settlement relative to those limits.
8. There are tax considerations applicable to purchasing, collecting, holding and selling Structured Settlements. Please note that Section 104 of the Internal Revenue Code, which exempts Structured Settlement payments being made to an injured person pursuant to a settlement, is not applicable to
Secondary market purchasers. Hence, the receipt of Structured Settlement payments are generally taxable to a secondary market purchaser. Purchasers should consult their own tax advisor as to the tax considerations that would be applicable prior to purchasing any Structured Settlements.
1. Purchaser receives significantly higher yields than Purchaser can secure from comparable fixed rate investments.
2. Purchaser receives a fixed income over a defined period of time, based on the specific parameters of the purchased Structured Settlement.
3. Purchasers can aquire this asset to increase the yields in personal holdings, to maximize income at retirement, or to preserve principal for future years. They can be purchased by individuals, retirement plans, corporate entities, foundations, trusts, through investment clubs, or group investment accounts.
4. The Structured Settlement is backed or supported by annuity contracts issued by a rated insurance carrier. The insurance carrier that issued the annuity contract is state regulated and will generally have a Standard & Poors credit rating between A- through AAA.
5. Purchaser has control throughout the investment process; Purchaser receives assignment of the Structured Settlement payment rights directly from the seller through an approved court approval process, and the Purchaser receives the future cash flows directly from the rated insurance company that is obligated to make the payments. At no time during the lifecycle of the asset should the broker have possession, or control, of the Purchasers money.
Considerations of Purchasing from Annuitant
1. The transaction process facilitates a court order of the asset directly from the Seller to the Purchaser. The broker does not own the Structured Settlement payment rights, and should not receive, hold, or disburse any of the investors money. This is NOT a fund, and the Structured Settlement payments are made directly to the Purchaser from the insurance entity.
2. The security of the annuity is directly related to the claims paying ability of the insurance entity. The designation of an annuity as a claims paying obligation means that these obligations supersede obligations to bond holders, stock holders and other debtors. The insurance entities are required to hold capital to support these obligations as required by the applicable state insurance regulator. To date, a situation has not been reported where an insurance company rated A, or better, by Standard & Poors has defaulted on an annuity obligation that supported a structured settlement, and a concomitant loss has resulted to the payee. However, as the current financial markets illustrate, past history is not a guarantee of future results, and there could be future issues that arise relating to Structured Settlements that have not existed in the past.
3. Annuities, depending on the amounts owed, are partially or fully guaranteed by state insurance funds, and are designed to protect annuity holders from loss. This may provide an additional level of security to the potential Purchaser.
4. Structured Settlements are issued in U.S. dollars. Foreign Purchasers should consider the impact of exchange rates and U.S. withholding taxes on any potential investment.
5. A Structured Settlement may be less liquid than other investment options. The court order assigns the payment rights directly to the Purchaser or designee, and any future assignments may require an additional court order. There is no established secondary market for the resale of Structured Settlements and hence, Purchasers should be prepared to hold the Structured Settlements for the entire term.
6. In evaluating Structured Settlement payment rights, Purchasers should review the structure of, and support for, the payment rights. For example, some Structured Settlement payment rights are guaranteed by the related insurance company.
7. The Structured Settlement payment rights purchased may be all of the payments due to a Plaintiff or only a portion of the payment rights. Because the court will only approve a transaction that is in the best interests of the Plaintiff, in many instances, only a portion of the payments can be purchased since the purchase price for these limited payments will meet all of the Plaintiffs current needs. Because most state guaranty funds have dollar limits on the amount that they can be obligated to pay in respect to annuities and life insurance policies issued by insolvent insurance companies, Purchasers should be cognizant of the size of the underlying annuity that supports the Structured Settlement relative to those limits.
8. There are tax considerations applicable to purchasing, collecting, holding and selling Structured Settlements. Please note that Section 104 of the Internal Revenue Code, which exempts Structured Settlement payments being made to an injured person pursuant to a settlement, is not applicable to
Secondary market purchasers. Hence, the receipt of Structured Settlement payments are generally taxable to a secondary market purchaser. Purchasers should consult their own tax advisor as to the tax considerations that would be applicable prior to purchasing any Structured Settlements.
Structured settlement - Wikipedia, the free encyclopedia
A structured settlement is a financial or insurance arrangement whereby a claimant agrees to resolve a personal injury tort claim by receiving periodic payments on an
What's A "Structured Settlement"? - Forbes
Like so much else in the world, structured settlements are mostly about taxes.
Structured Settlements Payment Options, Types & Laws
Structured Settlements. A structured settlement is a type of annuity that pays out an award from personal-injury cases, workers' compensation claims or other forms of
The Structured Settlement - ExpertLaw
Contents. What Is a Structured Settlement? Benefits of a Structured Settlement; Potential Disadvantages of Structured Settlements; Selling a Structured Settlement
structured settlement
structured settlement
Torts & Settlements MetLife
Structured Settlements. For 30 years, MetLife has provided financial security through structured settlement annuities for the claimants of personal injury settlements.
Why Structured Settlements | Ringler Associates
Why Structured Settlements The Who, What, Where & Whens. In simple terms, a structured settlement is a powerful financial tool created exclusively for injured people.
NFP: Structured Settlement: Personal Injury, Claim, Lawsuit.
When structuring a settlement for a personal injury claim or lawsuit, NFP Structured Settlements's team of professionals is committed to delivering personalized
Structured Settlements 4Real® Blog: Structured Settlements ...
Structured settlement information, structured settlement news, expert opinion and a dash of humor about structured settlements, settlement planning and other related
Federal tax policy & structured settlements | National ...
Under a structured settlement, This timeline is based in part on information contained in Structured Settlements & Periodic Payment Judgments by Patrick Hindert,
A structured settlement is a financial or insurance arrangement whereby a claimant agrees to resolve a personal injury tort claim by receiving periodic payments on an
What's A "Structured Settlement"? - Forbes
Like so much else in the world, structured settlements are mostly about taxes.
Structured Settlements Payment Options, Types & Laws
Structured Settlements. A structured settlement is a type of annuity that pays out an award from personal-injury cases, workers' compensation claims or other forms of
The Structured Settlement - ExpertLaw
Contents. What Is a Structured Settlement? Benefits of a Structured Settlement; Potential Disadvantages of Structured Settlements; Selling a Structured Settlement
structured settlement
structured settlement
Torts & Settlements MetLife
Structured Settlements. For 30 years, MetLife has provided financial security through structured settlement annuities for the claimants of personal injury settlements.
Why Structured Settlements | Ringler Associates
Why Structured Settlements The Who, What, Where & Whens. In simple terms, a structured settlement is a powerful financial tool created exclusively for injured people.
NFP: Structured Settlement: Personal Injury, Claim, Lawsuit.
When structuring a settlement for a personal injury claim or lawsuit, NFP Structured Settlements's team of professionals is committed to delivering personalized
Structured Settlements 4Real® Blog: Structured Settlements ...
Structured settlement information, structured settlement news, expert opinion and a dash of humor about structured settlements, settlement planning and other related
Federal tax policy & structured settlements | National ...
Under a structured settlement, This timeline is based in part on information contained in Structured Settlements & Periodic Payment Judgments by Patrick Hindert,