by Structured Settlement Watchdog
I was deeply offended, saddened and disappointed yesterday to receive, as most structured settlement brokers did, a package from Symetra, detailing its factoring ambitions. The factoring company apparently affiliated with Symetra, based in Bellevue, WA where Symetra is also based, is expanding its reach beyond its own internal book of business to structured settlement payment recipients of other annuity issuers. The part that really makes me sad and disappointed for Symetra is that the advertising for the affiliated factoring company shows a cool smiling healthy looking young Afro-American "dude" with a tag line that implies that selling structured settlement payments for pennies on the dollar is cool and will permit you to live your dreams. Excuse me Symetra but (in sending this package to your sale force) aren't you sending the wrong message to the people you want to reach. This business is not about "Dude, you're getting a lump sum!". What are you trying to say Symetra?
Many structured settlement recipients have broken bodies to go along with broken dreams. Many need the future periodic payments and the steady income to sustain them or their families. Should they sacrifice payments designed to replace income they can no longer earn to satisfy whimsical or even foolish instant gratification appealed to in the ad? From the numerous phone calls I've received from prospective sellers of structured settlement payment rights, I can tell you that many do not have a clear understanding of finance and the alternatives available to them other than factoring. I have helped people determine for themselves not to sell their structured settlement payment rights by helping them understand the alternatives. If you are a purveyor of structured settlement annuities or other financial products for injured plaintiffs how can you, in good faith and good conscience, operating under another "wrapper" ,and on a wholesale basis, enter the world of Wentworth, PPI Cash, Peachtree, set out to undo them for a profit?
The above comment is not about bashing those factoring companies. They are in the factoring business even though from time to time their advertising might suggest, in a manner confusing to consumers(as previously detailed in this blog), that they are structured settlement brokers, structured settlement consultants, structured settlements experts, structured settlement advisers or financial coaches etc.
Many annuity issuers of structured settlements will commute their annuities when presented with a "qualified order" as set forth in IRC 5891 and in compliance with local state law. Under a "qualified order" a Court must determine if the plaintiff's reasons for wanting to sell their structured settlement payment rights meet the prescribed guidelines. If approached by their own annuitants some annuity issuers will indeed commute their own annuities for hardship as an accommodation to the structured settlement payment recipients with a "qualified order". Until this package from Symetra we saw none of them going out wholesale into the factoring business.
What's puzzling to me is that here's a company that was spun off from SAFECO in 2004, doing a decent job at making a name for itself under the new brand. Its struggle to get to an A+ rating from A.M. Best predates the 2004 separation from SAFECO and it's trying to get back in a game in which (in its former life as SAFECO LIfe Insurance Company) it was once a substantial player. I'd like them to achieve this goal. However if you're trying to impress your structured settlement brokers and plaintiff attorneys this is not the way to do it. You need a different value proposition!
Symetra should take the example of The Prudential Insurance Company of America and Aviva Life who kept the faith of their structured settlement brokers during the period that they had lower ratings. To the best of my knowledge and belief these companies are not in the factoring business. Both of those companies were downgraded to "A" (Excellent") by A.M. Best for various reasons a few years back. Prudential, one of the largest life insurance companies in the United States (in terms of assets), cleaned house, clearly did some soul searching, they researched what the market needed, staffed up and have come back with an A+ (Superior) A.M Best rating and improved ratings from other rating services. I don't think other structured settlement brokers would disagree that they have come back as a major player in the marketplace. Aviva did much of the same and as we previously announced on this blog they recently came back strong with the A+(Superior) A.M. Best rating
I encourage Symetra to respond. This article will permit TrackBacks so that your response will be posted.
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