Structured settlements is an interesting vertical industry to explore the influence of legal changes, the role of the Internet and just how public policy issues come into play.
To transfer or not to transfer
Adam Scales has written a key paper in this area and questions one of the underlying tenets of NSSTA members selling annuities- that structured settlement recipients cannot look after their money and need to be protected from wealth dissipation. He points to a lack of evidence for this view and says that a few cases do not constitute a pattern nor a trend.
John Darer takes the opposite view and repeatedly calls upon factoring (transfer) companies to do away with misleading advertisements in his blog.
A settlement life-cycle
Scales points to an interesting quirk of legal wrangling. A traditional lump-sum settlement may be turned into a tax free structured settlement, which can then (subject to State Structured Settlement Protection Acts) be converted into a tax free lump sum payment. Along the way Insurance defendants may require that only registered brokers can handle the deal, assign payment responsibilities to a third party and remove liabilities from their balance sheets, factoring companies can then entice recipients, offer deep discounts, bundle their purchased AAA rated securities and resell these asset securitization packages for a profit.
Have been collecting S2 links on this S2-future wiki.
It all seems a little strange and unreal!!