Structured Settlements 4Real® Blog: Structured Settlements | Settlement Planning News and John Darer Reviews

Effective Date of Structured Settlement Agreements and Releases

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I'm astonished by the number of times my industry colleagues representing certain insurance companies employ the cookie cutter approach to structured settlement documents. The cookie cutter documents are bastardized versions of what was commonplace 20 years ago. I'm even more amazed that elements of this  "cookie cutter approach" make it past many a counsel.

The document typically begins with "This Settlement Agreement and Release is made and entered into this __ day of ____ 2009"

The closing paragraph before signatures in this form of document is something to the effect of:

" Effectiveness...This document shall become effective following approval of the settlement by the Probate Court (if minor's case) and by execution of each of the parties".

Our firm insists on receiving an executed set of documents concurrent with submission to the qualified assignment company, or the annuity issuer. More often then not the opening paragraph is not filled in. So the executed documents have blanks as to date the opening paragraph. Perhaps some of the legal scribes among our readers could explain what if anything "shooting blanks" means legally. If it is superfluous due to the closing paragraph then I ask my industry colleagues why the heck do you keep putting it there? If it is not superfluous, then why the aversion to filling in the blanks?

I am often snicker when I hear from a colleague "that the insurance company insists on doing it this way". Yeah right, I'm sure that there was an edict "from up above" to have a "blanks-in" standard.

** find this nifty jigsawpuzzle cookie cutter at Cribcandy.com

Settlement Planners Beware! Your Inaction May Result in Liability Exposure

by John Darer CLU ChFC CSSC

Settlement planners should not accept paid referrals from financial planners without defining the scope of the engagement, or they risk professional liability exposure. The increasing convergence of disciplines is fraught with both obvious and unrealized potential liability traps.

Consider this scenario:

1. After you consistently hold yourself out as a settlement planner or structured settlement planner in advertising or on your website,  you get a call from a financial planner  who it is evident is not a specialist in settlement planning or litigation recovery management. He claims to have total control over the proceedings for plaintiff Sally Jones.
2. You are asked to run some structured settlement quotes for an annuity with life and 30 years certain, perhaps a question or two about Medicare Secondary Payer or other topic.
3. You fail to ask critical questions that would be a standard part of the settlement planning process but you do agree to split your commissions 50/50 with the financial planner. 
4. In all your self promotion, you fail to define the scope of your engagement with the planner, the plaintiff attorney or the plaintiffs.
5. You subsequently acquire knowledge through observation or otherwise that  leads you to believe, in your professional knowledge and experience, that what your referral source (or the attorney) is recommending may not be in the best interest of the plaintiff. You elect to say nothing out of fear of losing the commission or fee that you will be earning by placing the structured settlement or other financial product.
6. Don't you have a duty to inform?
7. Some time after the case is resolved things don't turn out as planned. The plaintiff hires an attorney with a national reputation for prosecuting people who mislead seniors and disabled persons. You blame it on the financial planner. He blames it on you.
8. Think your case will hold up in court?

How about another version of this scenario where you observe and do speak up, but the financial planner, or attorney, ignores your recommendations? How have you documented your suggestion and the fact that it has been rejected?

Settlement planners with pride in their profession and a "love of their own hide" should not call themselves settlement planners unless they are planning to follow through.

"Attorneys on both sides of negotiations, while they may be expert in prosecuting or defending claims on behalf of their respective clients, are increasingly aware that they cannot, in many instances, also competently represent their clients in the intricacies of settlement planning. Some attorneys who have successfully negotiated large settlement amounts have been successfully sued by their own clients for failure to provide competent representation in planning other aspects of the settlement." Society of Settlement Planners Press Release March 31, 2008

Handling and Transmission of Original Settlement Documents-The Best Way

1. Why wait for for the slow route when you can have DOCUMENTS NOW?
2. Why chance that sensitive and confidential original settlement documents could be "lost in the mail" when you can track them RIGHT NOW online?
3. As a settlement professional and businessperson, are you interested in increasing your client's satisfaction with the structured settlement issue process?

   

4. As a settlement professional and businessperson, are you interested in the increasing overall satisfaction of ALL parties with the structured settlement issue process?

Incredibly I have encountered competitors who make thousands of dollars in commissions, yet still opt for 40c-$1.00 regular mail over a $5-$6 or even $10 FEDEX charge.

This "penny pinching" can turn out to be costly in more ways than one.

Consider the following as a general business practice :

1. FEDEX all sensitive documents, even if there is no time sensitivity.
2. Be sure that each outbound document going via FEDEX clearly displays the FEDEX Airbill number. When the airbill is created we often use FEDEX ship features to include electronic notifications to interested parties involved in the case in addition to a message which describes the content.
3. Include a return FEDEX prepaid envelope as needed.

You can save money on matters with no time sensitivity by using FEDEX Express Saver. I've found that many times FEDEX delivers the next day anyway, particularly to major cities. UPS, DHL and the USPS have comparable overnight services which include online tracking.

American Express Business Platinum holders get rebates/discounts for FEDEX services charged to the card.

THINK ABOUT IT!