Structured Settlements 4Real® Blog: Structured Settlements | Settlement Planning News and Commentary, Now in 14th Year!

Structured Settlement Annuitants from Lincoln Life Assurance Company of Boston Endure Atrocious Customer Service

by Structured Settlement Watchdog

After being in hold for an hour the on hold greeting from Protective Life said  " We treat you the way you want to be treated" .  Apparently that means like crap.

Protective Life is providing crap customer service to Lincoln Life Assurance Company of Boston structured settlement annuitants with insane on hold times.

The person on hold was a New York lawyer who had structured his attorney fees through Liberty Life Assurance Company of Boston. In 2018  Liberty Mutual Insurance Company completed the sale of Liberty Life Assurance company of Boston to Lincoln Life, which in turn farmed out administration to Protective Life Insurance Company in Birmingham Alabama.

Liberty Life Assurance Company of Boston was renamed Lincoln Life Assurance Company of Boston was renamed Lincoln Life Assurance Company of Boston effective September 1, 2019 and written notices were sent to annuitants

It should be emphasized that Liberty Mutual is completely divested Liberty Life for over a year and has no control over Protective Life, which is listed on a September 9, 2019 piece of correspondence as Administrator for Lincoln Life Assurance Company of Boston (formerly Liberty Life Assurance Company of Boston).

Here is what the New York attorney sent to structuredsettlements@protectivelife.com

"I received the attached letter and called to speak to someone As there are several issues with my above policy, including that you have a misspelling as to my street address which should be _______ROAD not _______Road. Please correct the spelling of my street name in your records.
Unfortunately, as I write this email I am now “ON HOLD” for over 40 minutes. About 10 minutes ago FINALLY someone picked up, whereupon I was advised that by the rep that she could not help me as my policy was handled at a different office, and she transferred me to that other office and I now remain ON HOLD once again for 10 more minutes and counting!"

One hopes that Protective Life will, in short time, iron out this horrible first impression of Protective Life customer service as adminstrators and that Lincoln Life Assurance Company of Boston and its parent pay attention. as well.

What To Do If You have an Urgent Need and Can't Wait on Line?

In the mean time if you are receiving, or scheduled to receive structured settlement payments from Lincoln Life Assurance Company of Boston (formerly Liberty Life Assurance Company of Boston), I suggest you take the following steps:

1. Visit the Protective Life Structured Settlement Administration Page
2. Dowmload and complete the forms for the service you need
3. FAX in the paperwork and save the fax confirmation.
4. If you have not received written confirmation within 48 hours, repeat the process.

 

 

 

 

Liberty Life Assurance Company of Boston to be Acquired by Lincoln Financial Group

by John Darer® CLU ChFC MSSC CeFT RSP CLTC

Lincoln Financial Group announced January 19, 2018 that it has entered into a definitive agreement to acquire Liberty Life Assurance Company of Boston from Liberty Mutual Insurance Group. Upon completion of the transaction, Lincoln Financial will retain Liberty’s Group Benefits business and reinsure Liberty’s Individual Life and Annuity business to Protective Life Insurance Company ( a subsidiary of Dai-Ichi Life Holdings)  The acquisition, which is expected to create a single, powerful Group Benefits operation with industry-leading products, services, and capabilities, is expected to be completed in the second quarter of 2018, pending regulatory approvals.

What Does this Mean to Liberty Life Assurance Company of Boston for new structured settlement business?

Liberty Life Assurance Company of Boston is no longer writing structured settlement annuities on either a qualified or non qualified basis.

What Does This Mean to Liberty Life Assurance Company of Boston annuitants?

Both Lincoln Financial (a Fortune 250 Holding Company) and Protective Life are regulated and rated A+ by A.M. Best.  By comparison Liberty Life Assurance Company of Boston is rated A. In emails to its appointed agents Liberty emphasized that it will honor its commitments on in-force annuities. I have asked for further written confirmation. Protective Life was founded in 1907, with $78 billion in reported assets on its Form 10-Q for Q3 2017. Protective is owned by Dai-Ichi LIfe Holdings. founded in 1902.  View Lincoln Financial Powerpoint on the Liberty Life Assurance Company of Boston acquisition Download LNC+Liberty+Acquisition+Presentation

Liberty Life will process current locked in business but will no longer accept premium from mid February 2018.

What Does This Mean To the Structured Settlement Industry?

Much of the non qualified structured settlement side will be absorbed by other sources, such as Havelet, SAI and National Indemnity reinsurance (where there is an insurance company paying on behalf of Defendants) and/or other alternatives. Metropolitan Tower Life Insurance Company recently entered the non qualified structured settlement market and offers a domestic non qualified assignment company, based in Delaware as opposed to Barbados.  The limitations for the domestic company will be that non qualified structure design must comply with IRC 72(u), the most significant of which will be payments must start within 13 months (I.e. no later than deferrals beyond a year).  But where Liberty would not entertain the use of its product for structured installment sales, Metropolitan Tower will. Metropolitan Tower recently announced its merger with another MetLife subsidiary General American Life, part of the "original game plan" for those who listened, that appears to further strengthen their offering.

The sky isn't falling!  It surprises me that some of my industry colleagues tend to paint with a narrow tip negative brush whenever there is change in the industry.  Many of the newer entrants to our industry have no idea about companies long gone from the industry such as Commonwealth, United Pacific Life, Presidential, Manulife, Confederation Life, Peoples Security, Security Life of Denver (ING). The bottom line is that you can't avoid change but you can manage the change. Pacific Life only entered the structured settlement market in 2012 and in 2017 was the second biggest in terms of production. 

What Do You Do If You Have a Liberty Life Assurance Company of Boston structured settlement and are approached by a company offering cash for your structured settlement?

The secondary market's cockroaches come out of their burrows whenever a company exits the marketplace and try to scare annuitants so that they or their investors can make fat profits. Ignore them. In 2008, they scurried about scaring annuitants they could sucker from American General ( a subsidiary of AIG, that wasn't leaving the business). A decade later American General continues to honor its commitments and those suckers lost a fortune. More cockroaches came out when John Hancock and Allstate exited the market in 2013. 

Some will offer to help you "manage your annuity", or give you information that is often incorrect, Anytime you see or hear from one just remember that their solution is fleecing you for cents on the dollar.

More details to follow.

 

Structured Settlement Annuity Issuers In 50% of Top 12 US Holding Companies 2016

by John Darer® CLU ChFC MSSC RSP CLTC

Structured settlement annuities tend to be issued by largest and well capitalized insurers in the United States. 50% of the top 12 insurance holding companies in the United States include a subsidiary or subsidiaries that issue structured settlement annuities. [ Data compiled from Best's Review, based on 2016 assets]

MetLife Inc.   

• Metropolitan Life Insurance Company
• Metropolitan Tower Life Insurance Company

Prudential Financial, Inc.

• The Prudential Insurance Company of America

Berkshire Hathaway, Inc.

• Berkshire Hathaway Life Insurance Company of Nebraska
• First Berkshire Hathaway Life Insurance Company
• Columbia Insurance Company
• National Indemnity Company

American International Group, Inc.

• American General Life Insurance Company
• United States Life Insurance Company in the City of New York
• Variable Annuity Life Insurance Company [(VALIC)  former]

The Hartford Financial Services Group. Inc.

• Hartford Life Insurance Company (former issuer)
• Hartford Life Inc. (a guarantor under the Hartford program)

Pacific Mutual Holding Company

• Pacific Life Insurance Company
• Pacific Life and Annuity Company

Liberty Mutual Holding Company Inc.

• Liberty Life Assurance Company of Boston
• Liberty Mutual Insurance Company (guarantor of Liberty Life)

 

LTD Structured Settlements for Disability Claim Settlements | Employer Paid LTD Claims

by John Darer® CLU ChFC MSSC RSP CLTC

Long Term Disability Claim Structured Settlements are a better way to settle employer paid LTD Claims

What is LTD Insurance?

LTD or long term disability insurance is an insurance policy that protects an employee from loss of income in the event that he or she is unable to work due to illness, injury, or accident for a long period of time. The ability to earn an income is a valuable asset and many people choose to protect it though disability insurance.  It can be paid for by an employer, partially paid for by the employee or an individual can purchase individual coverage. 

How Are LTD Benefits Taxed?

IRC §104(a)(3) provides a tax exclusion for amounts received through accident or health insurance (or through an arrangement having the effect of accident or health insurance) for personal injuries or sickness (other than amounts received by an employee, to the extent such amounts (A) are attributable to contributions by the employer which were not includible in the gross income of the employee, or (B) are paid by the employer)

Simply said, individually paid LTD benefit payments are tax exempt while Employer paid LTD benefit payments are taxable.

Group LTD Disability Settlement Offers Need to Be Reviewed Carefully

• Your employer or its group LTD insurer may offer a lump sum disability settlement. What this means is that you are being offered the present value of all or a portion of your future monthly disability benefits.
• This calculation provides the insurance company with a discount for paying you a lump sum settlement today, as opposed to paying out monthly benefits over the course of time.
• A lump sum settlement on an employer-paid Group LTD plan is also fully taxable. It’s important to take in to account that the discounted lump sum you are being offered, is further discounted by taxes and applicable attorney fees. For some people such a settlement could expose them to the Alternative Minimum Tax (AMT). An LTD Structured Settlement is one way to mitigate this problem.

Group LTD Structured Settlement Using a Non-Qualified Assignment

We offer a solution for both insured and sell-insureds through Liberty Life Assurance Company of Boston, in conjunction with BARCO Assignments Ltd. (BARCO), utilizing a non-qualified assignment for all structured long-term disability settlements.

• Allows the Group LTD insurer/employer to be fully released from the future periodic payment obligation
• Provides the claimant with a customized stable income stream.
• The periodic payments are funded through the purchase of an annuity from Liberty Life Assurance Company of Boston. A Liberty Mutual Insurance Company guarantee backs up Liberty Life Assurance Company of Boston
• Liberty Life is able to accommodate scenarios where the insurance is fully or partially employee paid and will provide applicable tax reporting. If a claimant is to receive both taxable and non-taxable payments, two contracts will be issued, one for each type.

Benefits of Structured Settlements on LTD Claims

For both taxable and nontaxable disability settlements, structured long-term disability settlements

• may assist both claimant and insurer in successfully bringing resolution to a claim.
• customized payout. Payment can be made monthly, annual, immediate, deferred, fixed cost of living adjustments and lifetime income streams.

For taxable disability settlements, structuring long-term disability settlements

• an opportunity to receive income in a more tax-efficient manner.
• greater overall payout than would otherwise be achieved with a single, lump sum settlement
• avoidance of escalation into higher tax brackets
• preservation of deductions that may be lost at higher income levels
• avoidance of the alternative minimum tax (AMT)

How Do You Deal with Tax Reporting When an Employer Paid Disability Settlement is Structured?

• Per IRC §3504, Liberty Life Assurance Company of Boston will execute an agent agreement with each employer or disability carrier who enters into settlement agreements funded by Liberty Life annuities via Form 2678. Many disability insurers already have these in place with Liberty Life.
  
• Estimated turnaround time with the IRS, if there is no Form 2678 in place. Please contact us in advance so we can verify whether an agent agreement is already in place with a particular insurer.
• In accordance with IRC Section 3504, Liberty Life will complete a quarterly filing of Form 941 and Schedule R to report wages paid.
• Liberty Life will issue a Form W-2 annually in connection with the payments to the claimant.

 For more information call John Darer at 888-325-8640

Demand Liberty Mutual for Structured Settlements, Not Liberty Settlement Funding

by Structured Settlement Watchdog®

A poor man's JG Wentworth copycat commercial by Liberty Settlement Funding features people demonstrating with green placards that say Liberty and beg you to "Demand Liberty" as if structured settlement annuitants are unionized workers whose workplace rights have been violated.  The misleading bullshit from a member of the National Association of Settlement Purchasers demands "freedom from long term payments'  and asks "why let someone else hold your money that's rightfully yours".

In letting its members speak for themselves, the National Association of Settlement Purchasers continues to reveal itself a feral herd of duplicitous business people. On the one hand there are those who feign magnanimity while at the other hand misleading consumers at every turn in their advertising or business conduct.

Why Liberty Settlement Funding is Disingenuous

A. "Freedom from Long Term Payments"   A structured settlement is a negotiated agreement, not something that forces a personal injury victim to wear handcuffs and leg irons and be fed through a meal slot in the door. 

On Monday I received a call from a gentleman who agreed to a structured settlement to compensate him for his physical injuries in an accident 3 years ago. During the call, which was for a routine administrative matter. I asked him how he felt about his structured settlement now and he said it was a great move for him because it eased the financial pressure by providing the steady income, allowing him to heal in his own time.

B. " Why let someone hold money that's rightfully yours" 

The ubiquitous message, not confined to Liberty Settlement Funding,  is a sample of the worst misleading marketing messages on offer in the structured settlement secondary market. Why quit a steady job and give up a steady paycheck that is free of income taxes and expose yourself to market risk?  The only solution that Liberty Settlement Funding has is to get you to part with your steady job and steady tax free paycheck for a payoff that makes them a boatload of money, not you. The lame "shop steward" leading the "job action" in the Liberty Settlement Funding ad is lining her pockets at your expense.

C. "Don't miss The Boat'

Do you really care if you miss a financial shipwreck, Gilligan?   Keep your money, Duck Liberty Settlement Funding and take a DuckTour in Boston.

If you are going to "Demand Liberty', demand Liberty Life Assurance Company of Boston or Liberty Mutual Insurance Company. 

Liberty Life Assurance Company of Boston is a prominent structured settlement annuity issuer. "Shackle' yourself to a steady job and a steady paycheck with a company that is 90% owned and is guaranteed by the most prominent workers compensation insurer in the USA,  a company in business for over a century. 

Visit Boston and demand the Liberty Hotel. Cool rooms and pet friendly too!  Visit the historic Liberty Mutual building and the Freedom (Liberty) Trail. 

Good Faith Use of Structured Settlements in Bad Faith Claims

by John Darer® CLU ChFC MSSC RSP CLTC

Insurance bad faith  describes a tort claim that an insured person may have against his/her/its  insurance company for its intentional bad acts. Under the law of most jurisdictions in the USA, insurance companies owe a duty of good faith and fair dealing to the persons they insure. This duty is often referred to as the "implied covenant of good faith and fair dealing" which automatically exists by operation of law in every insurance contract.  [ Source : Wikipedia]

In Good Faith Use of Structured Settlements in Bad Faith Claims,  published in the Connecticut Law Tribune on March 14, 2016 , I explore how structured settlements can make a difference in bad faith cases on either side of the damages tax spectrum.  Download Good_Faith_Use_of_Structured_Settlements_in_Bad_Faith_Cases_3-2016 .

I am a frequent contributor to "The Trib". The Good Faith/Bad Faith article, is my 6th published in the Connecticut Law Tribune in the last 12 months.

For further information on structured settlements and bad faith claims and practical illustrations, please contact the structured settlement experts at 888-325-8640

Structured Settlements for Employment Lawsuits and Other Commercial Disputes

by John Darer® CLU ChFC MSSC RSP CLTC

Structured settlements are not just for personal injury, medical malpractice and wrongful death settlements. Structured settlements are also a solution for settlements with taxable damages, such as employment lawsuits and commercial disputes, through non qualified assignments and periodic payment reinsurance.

Possible Tax Benefits of Non Qualified Assignments and Periodic Payment Reinsurance

Help spread tax liabilities throughout future years, smoothing out income and potentially alleviating high tax obligations in the year of settlement.

1. A potentially greater overall payout than would otherwise be achieved with a single lump sum payment even taking into account taxes that ultimately have to be paid.
2. Avoidance of higher tax brackets
3. Preserve tax deductions that may be lost at higher income levels
4. Avoidance or mitigation of the alternative minimum tax (AMT)

• Annuity funded non-qualified assignments are currently available through appointed agents and brokers for Liberty Life Assurance Company of Boston and the BARCO Assignments, Ltd. facility, a Barbadian entity. Under the program, Liberty Life Assurance Company of Boston provides assurance that BARCO will have the minimum amount of net assets to conduct business under Barbados law,a nd if at any time BARCO has insufficient funds to make and reuqired payment under the terms of any obligation it has to a creditor, Liberty Life Assurance Company of Boston will contribute to BARCO funds BARCO needs in order to meet its payment obligations. Liberty Mutual Insurance Company owns 90% of Liberty Life Assurance company of Boston and provides a guarantee of its payment obligations. Liberty Mutual Insurance Company has been in business for over 100 years, founded in 1912.
• Treasury Funded Structured Settlements can be used and are currently available through Structured Assignments, Inc (SAI).     SAI is a Barbadian company, like BARCO,the big difference being that obligations are funded through the purchase of United States Treasury Obligations which are held in a sub-trust of a master trust at Midwest Trust Company. the SAI facility may also be used for structured installment sales, enhanced attorney fee structures  (EAFS) and more.
  
• Periodic Payment Reinsurance is available through National Indemnity Company, a unit of Berkshire Hathaway and a unit of American General. Many of the same transfers of risk can be accomplished as with non qualified assignments, however periodic payment reinsurance can only be utilized where the paying party is an insurer. An individual cannot fund a liability using  periodic payment reinsurance.

Structured Settlement Annuity Insurers Part of The Top 10 US Holding Cos.

by John Darer® CLU ChFC MSSC RSP CLTC

Structured settlement annuities continue to be written by the largest, most well capitalized and reserved insurance companies.  Findings by A.M. Best suggest the current is no exception.

MetLife Inc  (3)., Prudential Financial,Inc (5) AIG (9) and  Berkshire Hathaway Inc. (14) are 4 out of the World's 25 largest insurance companies, according to a new report by A.M. Best, based on 2013 non-banking assets.

5 out of the top 10 US insurance holding companies by size AND revenue, currently write structured settlement annuities through their subsidiaries

TOP US Insurance Holding Companies (2014)

By Size

1. Met Life Inc.                               $902B+
2. Prudential Financial, Inc.        $766B+
3. Berkshire Hathaway,  Inc.       $526B+
4. AIG                                                $515B+

10.  Pacific Mutual                          $137B+

 

By Revenue

1. Berkshire Hathaway Inc.          $194B+

4. MetLife Inc.                                $  73.3B+

5. AIG                                                $  66.B+

7. Prudential Financial Inc.            $ 56B +

9. Liberty Mutual                              $39.6B+

 Source:  Understanding the Insurance Industry,  November 2015 by A.M. Best

Top Insurers by  Capital and Surplus (2014)

P&C

1. Berkshire Hathaway Insurance Group   (inlcudes Columbia Insurance Company, National Indemnity Company and other subsidiaries that underwrite,  or guarantee,  structured settlements

3.  AIG

4. USAA

6.  Liberty Mutual

  (guarantor of Liberty Life Assurance Company of Boston) 

 

Life

4. New York Life Insurance Company

6. Metropolitan Life Insurance Company

8.  Prudential Insurance Company of America

10. AGC Life Insurance Company  (guarantor of structured settlement written through AIG subsidiaries, American General Life Insurance Company and United States Life Insurance Company in the City of New York)

Positive Signs in Structured Settlement Industry Growth Despite Rates

by John Darer® CLU ChFC MSSC RSP CLTC

 

Melissa Evola-Price's yearly report of Structured Settlement Industry Production Has Become a Rorshach Test of Sorts

Melissa Evola-Price's structured settlement industry production reports have become a Rorshach Test of sorts.  A recent tradition following each annual release is the predictable droning cynicism of industry curmudgeon, Patrick Hindert, which yet again fails to inspire.  His decade long quest to figuratively tie anything not "nailed down" to factoring, is simply "la vache qui rit". 

On the other hand there ARE people who are optimists and successful ones at that.

Structured Settlement Industry is "Grinding Out The 1-0"

I am a lifelong fan of Chelsea FC in London England.  Chelsea,  a team currently sitting at the top of the Premier League with an assembled pool an exceptional talent and character that is equally adept at defeating opponents with skill, creativity and power, as it is at  grinding out 1-0 victories. In the 2004-2005 championship winning season, more than 25% of the teams wins were by this result. It is the latter where I see a parallel strength to the structured settlement industry of this moment in time. Our industry is populated by skilled professionals who are mentally capable of  "playing for 90 minutes and grinding out 1-0 victories"

Explain " Grinding Out the 1-0" in the Structured Settlement Context 

Structured settlements aren't sexy and never were. but consider that the 2% year over year industry growth (as measured by annuity premium) was achieved despite lingering low interest rates and a trend of tightened up medical underwriting by annuity issuers.  This is the second straight year of  a structured settlement recovery by the nominal metric of annuity premium.

What this could mean is:

• Safety, security and guarantees are ultimately more important to consumers of structured settlements than interest rates.
• Comparable bond rates and CD rates fail to impress
• Older claimants are possibly more likely to agree to a structure to address longevity risk
• The ways in which a structured settlement is positioned in the settlement plan and the need(s) addressed by the structured settlement may have changed.
• We are seeing the results of improvements in education and training of both industry members, attorneys and consumers and a growing level of sophistication.
• Lower interest rates mean higher costs to establish the funding of life care plans and the cost to fund elements of damages in New York structured  judgments under CPLR Articles 50A and 50B.
• The structured settlement industry has historically shown the strength to absorb and overcome negative developments. More recently:    

1. The 2013 withdrawals of John Hancock and Allstate have proved to be a non-event from the standpoint of industry production.  With the exception of structured installment sales, there has been no loss of capacity as other companies have simply absorbed the production.
2. Neither the ELNY liquidation itself, nor any blogs, podcasts, trade journals mainstream televsion or publications are causing industry production to decrease.
3. The Ringler and EPS Class Actions related to ELNY era alleged actions  have not affected industry production
4. If what has been alleged in the Insurers' Complaint against Ringler is true, I expect that rogue former structured settlement broker Mike Woodyward of Dallas, will be arrested and eventually be incarcerated over his alleged Ponzi scheme. I believe that representatives of insurers will be able to discern how none of the cases involved structured settlements per se (they went through the same channel),  how things went horribly wrong with Woodyard, how the manner in which funds were transmitted was irregular and how they could have been prevented by a simple common place procedure.

Worthy of note from this side of Evola Price's " Rorshach test"

• Berkshire Hathaway has been on an upward trajectory in the 4 years since its return to the marketplace. Berkshire continues to dominate, but other carriers are holding their own.  Premiums to MetLife, Prudential,  New York Life and Liberty each grew in 2014. Pacific Life is still one of the leading companies despite a year over year reduction. 
• The Liberty story is a very good one.  Liberty, through BARCO offers the only US domestic structured annuity funded** and US domestic insurer guaranteed non qualified assignment program available to self insureds.  With the withdrawal of MetLife from the reinsurance market place, tax deferred structured settlements are a niche market place now populated by Liberty/BARCO, National Indemnity ( no self-insureds)  and some other entities non under the auspices of the insurance industry.

Evola-Price's numbers do not reflect:

1. Personal Settlement Annuities issued by MetLife Insurance Company (USA) after constructive receipt has occurred, within 90 days of settlement.
2. Use of non structured settlement annuities to fund MSAs.
3. Non qualified assignments produced through Structured Assignments Inc., Havelet Assignments, Brook Hollow or other non qualified assignment companies, including two being pitched by a Buffalo New York structured settlement broker to the trial lawyer community.
4. Assets under management acquired through the work of industry members.
5. The evolution and growing use of recycled payment streams from factored structured settlements, annuities and other cash flows to partially fund a plaintiff's future needs or as an investment by the trustee of a trust on behalf of a plaintiff.

A colleague of mine said he had one of his best years ever in 2014 and another just wrote a $41 million case. I'm equally proud of integrating skills I have developed as a Sudden Money adviser into my practice, to help serve clients better, continue to add more value and close cases that might have been more challenging to do before.

**recycled payment streams are technically not annuities, even if the payment stream acquired is  backed by an insurer.  Some recycled payments streams are subject to servicing arrangements. The servicing company may not have the same asset base or financial strength as the underlying issuer and insolvency of the servicing company, or back up servicer, if applicable,  could cause additional costs to a partial seller. I first brought this up in 2009 and did a series of video podcasts with Dallas bankruptcy attorney Bruce Akerly.

 

Use of Employment Structured Settlements Helps Negotiate Better Settlements

by John Darer® CLU ChFC MSSC RSP CLTC

There are many reasons to consider a structured settlement in an employment related lawsuit for the employers, insurers of the employer  and the former employees that are suing them. Check out my latest video Employment Structured Settlements | Negotiate Better Settlements