by John Darer® CLU ChFC MSSC RSP CLTC
A structured settlement payee (who was not one of my clients) called me 24 years after his structured settlement was established. The man had diversified with three structured settlement obligors, Safeco (Symetra) Assigned Benefits Service Company, Transamerica Annuity Service Company and the generic named "Structured Settlement Trust". He could not locate the latter and his payment had not yet arrived.
It was remarkable that while each continues to meet its obligations, not a single entity is writing structured settlements in 2017.
The regulatory take over of Executive Life Insurance Company in the midst of a period that also saw the failure of 1,043 out of the 3,234 savings and loan associations in the United States from 1986 to 1995, saw a number of life companies came up with treasury funded structured settlements as alternatives to annuity funded structured settlements. Treasury bonds are a permissible qualified funding asset under IRC 130(d). In addition the Schultz brothers and the late Richard G. Halpern, several life insurers created their own version of a treasury funded structured settlement (then also known as "T-Bond Trusts"), including GE Capital and Allstate, whose assignment company was called "Structured Settlement Trust".
Use of Generic Names in Structured Settlement Products
When naming these entities it would be worth the consideration of those establishing such a trust to not use a generic name. The reason is simple, it is reasonably foreseeable that over the term of the trust, some beneficiary of a trust will lose or misplace their paperwork, or it could get destroyed in a fire or flood or eaten by the proverbial dog (along with the homework assignment). When I Googled "Structured Settlement Trust", absolutely nothing related to Allstate came up. When you consider in the near quarter of a century that some of the people who sold the "Structured Settlement Trust" are retired or even deceased, it is fortunate that there was one seasoned veteran on a list serve who was spot on with the answer that it was Allstate's version of the treasury funded structured settlement.
Companies Cease Writing Products and There Are Spin Offs and Mergers
Allstate ceased writing new structured settlement annuities in 2013. Shortly thereafter, ostensibly to lower the ongoing cost of servicing of its in-force block of structured settlement annuities, it farmed the public interfacing customer service function out to a Philippine call center. In April 2015, I reported how a very stressed out Allstate annuitant was told by the Allstate Philippine call center that her 20 years certain & life payments had stopped [see Allstate Structured Settlements | If You Have One You Must Read This]. Fortunately in contacting me she reached someone who knew the history that Allstate had the peculiar practice of issuing separate contracts for the period certain and life time components of a structured settlement and determined that this was a coding error on Allstate's part. Through sheer persistence, we were able to get it resolved by going directly to Allstate and advocating for this annuitant until we found someone who knew the history and could get the problem fixed.