by John Darer® CLU ChFC MSSC RSP CLTC
What is a Uniform Qualified Assignment? The Uniform Qualified Assignment (UQA) is part of a series of model documents to effect a transfer of structured settlement payment obligors at the time a structured settlement is established. The uniform qualified assignment documents were created by a collaborative within the National Structured Settlements Trade Association in the early days of the structured settlement industry to facilitate structured settlement transactions. You know how some women like men in uniform? Well some people like qualified assignments "in uniform".
There were three types of "Uniform Qualified Assignment" Agreement:
1. Qualified Assignment (QA)
A legal instrument executed by Defendant, Insurer or Qualified Settlement Fund Trustee and Qualified Assignment Company
Also referred to as a two party qualified assignment
2. Qualified Assignment and Release (QAR)
A legal instrument executed by Defendant, Insurer or Qualified Settlement Fund Trustee, Qualified Assignment Company and Releasing Party
Also referred to as a three party qualified assignment
3. Qualified Assignment Release and Pledge (QARP)
A legal intrument executed by Defendant, Insurer or Qualified Settlement Fund Trustee, Qualified Assignment Company and originally just the Claimant-Secured Party. Used where there is a desire to give the payee a security interest in the annuity contract.
Acceptance of Standardized documents Was Not "Uniform"
As with any model or standardized document its utility is a function of its adoption, first by the annuity issuers and then by the parties to the agreement. The uniform documents were accepted by some but not all of the structured annuity issuing life insurance companies, particularly on the Qualified Assignment Release and Pledge. Not all companies offer the QARP Of the current structured annuity issuers, New York Life Insurance Company and USAA Life Insurance Company. Of the companies that do most have their own documents.
Changes of any sort make the documents not uniform
A good example is where the original uniform qualified assignment documents (believe it or not still being used by some brokers) only provide a discharge of obligation for mailing of a check when many people use electronic deposits today.
Another more complex example is where the original uniform qualified assignment release and pledge documents (and the second round of model documents) fail to recognize that the Claimant-Secured Party might be an individual or entity other than the Releasing Party (e.g where a trust is payee) and/or fails to consider what, if any, impact that exercising rights under the pledge as a secured party might have on eligibility for government benefits.
Watch my informational video on Qualified Assignments (below). In the video I take you step-by-step through a personal injury structured settlement transaction in a case that involves payment of damages for physical injury or physical sickness.
Last updated February 26, 2021