by John Darer® CLU ChFC MSSC CeFT RSP CLTC
John Hancock Life is rolling out a structured settlement exchange program that enables John Hancock annuitants to address their liquidity needs while providing a measure of protection against secondary market predators.
The John Hancock Structured Settlement Exchange program is unique for being established at a time when John Hancock is not writing structured settlement annuities. John Hancock ceased writing structured settlement annuities in 2013.
The John Hancock Structured Settlement Exchange program is similar to the Allstate AFEN program and Berkshire Hathaway's Hardship Exchange Program, at a discount rate that is competitive, but definitely not the lowest possible rate. Always shop around. Selling structured settlement payments usually doesn't make sense for most people, but at least John Hancock Life annuitants who must go down that road, now have a ceiling above which they should not be paying to another structured settlement buyer. No John Hancock Life annuitant should pay more than 8% on any sale of structured settlement payments. 8%
Commutation programs are a source of consternation from structured settlement factoring companies who complain that it gives the annuity issuer an unfair advantage, while factoring companies must incur advertising expense to find prospects.
On the other hand one has to consider that the structured settlement factoring industry has no licensing requirement, unregulated sales practices and has an appalling history that has earned blistering exposes in national news media for member business practices (not to mention all the Structured Settlement Watchdog® has sniffed out). There are currently two ongoing lawsuits against life insurers for not doing enough for their annuitants when noticed of a structured settlement factoring transaction. In my opinion offering a structured settlement exchange or hardship provision is smart business.