Litigation

Do Annuity Issuers Really Give a Crap About Plaintiffs?

By John Darer

I am going to go out on a limb with this one because I, for one, want to know how many structured annuity issuers really give a crap about plaintiffs? One can read the brochures, look at the web sites and the marketing hype. Are you angry yet friends? GOOD.

The Halpern Group,  an undisputed friend of plaintiffs, has strong anti-assignment language in the qualified assignment agreements fro its United States Treasury Bond Structured Settlement Trust. has recently been endorsed of the American Association for Justice.  My sources tell me that cash now pusher companies such as J.G. Wentworth hardly bother going after Halpern clients because they're going to be shut down by the Halpern anti-assignment language. Halpern Group anti assignment language is available to resourceful members of the structured settlement industry. Why did Halpern Group do this?

Richard Halpern tells me that a personal decision was made not to allow Halpern Group products to  be factored:

1. To have competitive advantage
2. To offer more safety to injured plaintiffs
3. To stimulate new business from attorneys who are concerned about their client's factoring.

This "marketing gimmick" is something that no structured settlement annuity issuer offers today and I understand from Halpern that it is good for business.

WHAT COULD BE THE REASON FOR INSURANCE INDUSTRY INACTION?

Why couldn't an annuity issuer make its own decision, without the hamstrung imprimatur of NSSTA, SSP or Patrick Hindert to add and enforce anti-assignment provisions except in extreme circumstances? The solution is an easy one, could be done today, but no structured annuity issuer seems to have the balls to take it.

1. Could it be a tax issue? If so, I challenge any structured annuity issuing life insurance company, NSSTA member, SSP member, or their counsel to state the tax reasons why.
2. Could it be the fear of anti-trust? Absent Federal regulation of insurance doesn't McCarran-Ferguson prevent that? The Act provides that federal anti-trust laws will not apply to the "business of insurance" as long as the state regulates in that area, but federal anti-trust laws will apply in cases of boycott, coercion, and intimidation.
   
3. Could it be the never ending supply of factoring company securitizations that provide attractive returns for life insurer portfolios? I challenge every structured annuity issuer to come clean on whether their company does or does not purchase structured settlement securitizations in any of its divisions. If a company does not purchase the securitizations why not use it as competitive advantage?
4. Could it be pressure put on them by some of their own agents because those agents are receiving payments from the factoring industry?
5. Could it be pressure put on them by some of their own agents because those agents have convinced those companies that IRC 5891 confers rights ? An example to those that tell you otherwise:
   
   "IRC 5891 is NOT a money mandating statute that creates a substantive right enforceable against the United States for money damages" 424 U.S. at 398.

Can anyone think of any other plausible explanation why The Halpern Group appears to be the only person or entity providing products to tort victims that has the balls to do something in this regard?

This issue needs to be out on the table despite the fact that many in the structured settlement industry do not want it to be.  Scared by the shrinkage of market capacity some wish to sweep this issue under the rug.

Full post as published by Structured Settlements 4Real on March 20, 2009 (boomark / email).