The decision to commute or factor is simple or complex depending on how deep you dig and where you stand!!
Through my partner Patrick Hinderd, I've been involved in the S2 (structured settlement) industry for the past 6 years. This is a complex legal area, ripe for the application of KM practices.
The recent, 12/25/06 release of a paper by Rob Wood calls into question the legality and economics of Insurance Companies that seek to 'factor' their issued structured settlement agreements through commutation, as this may violate IRC Section 130(c) that prohibits acceleration.
There is a fine line between 'acceleration' and the legal safe harbor afforded by IRS 5892 that merits a deeper look at assignments, 'automatic' commutation and potential conflicts between State and Federal laws. This is an area that clearly cries for clarification via concept mapping.
What say you?