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: Structured Settlements 4Real

Flawed "Plaintiff's Structured Settlement Rights" Bill Purportedly Introduced in New York Assembly by Rory Lancman

By John Darer

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The word on he street is that Forge Consulting, LLC President John T. Bair is purportedly behind a plaintiff's rights in structured settlements bill that has been introduced by New York Assembly member Rory I. Lancman (25th District), who is also "Of Counsel" to Morelli Ratner, PC, a leading plaintiff firm in New York City.

The purported bill would allegedly require:

-a plaintiff to retain his or her own broker in a structured settlement purchase and for the broker to receive 50% of the commissions

-preclude a P&C insurer from purchasing an annuity from an owned or affiliated life carrier.

If this bill does in fact exist it is flawed because it does not deal with factoring industry business practices because there is where the biggest plaintiff issue lies. Surely Mr. Lancman, who is involved with a leading plaintiff firm must be aware of the abusive advertising by such companies to New York State residents who are structured settlement recipients? Mr. Bair surely is.

A plaintiff attorney seeking independent advice IS a good business practice. Is it necessary to spend the legislature's time on something to mandate common sense? They should be doing so regardless of any laws. The commissions should be negotiated.

Precluding a PC insurer from purchasing an annuity from an owned or affiliated carrier is a case of "careful what you wish for". One thing that attorneys for tort victims must understand is that by eliminating one annuity issuer from consideration you are now denying your client the possibility of having a full market survey. Not something that I would want for my client if I was their lawyer.

Suppose the eliminated annuity issuer is the most competitive and nobody else will match?
Suppose the eliminated annuity issuer is rated A++ by AM Best like American International Life Assurance Company of New York or perennially one of the largest and most competitive on lifetime payments, Metropolitan Life Insurance Company?

I know I know plaintiff lawyers... you've read or heard about Macomber v Travelers and/or Spencer v Hartford and you're thinking how can I trust these people? One could make a good argument if the affiliated carrier was the only choice and it was uncompetitive that such a limitation was unreasonable. But if there is a wide selection available why eliminate a choice? If it's a large enough case the eliminated annuity issuer could meet diversification needs.

Some of the PC insurers affiliated life companies have the most competitive rates. If such a situation arises and Lancman's purported bill becomes law, are you going to tell your client that they cannot obtain the best rate?

New York State assembly persons and plaintiff lawyers should exercise caution. Some settlement consultants, like Forge Consulting, have promoted themselves as "champion of the qualified settlement fund" and promised full market access to plaintiffs when the reality is that there may be limited market access.

Full post as published by Structured Settlements 4Real on May 25, 2008 (boomark / email).