by Structured Settlement Watchdog
Ownership of Structured Settlement Annuity Policy Fail by Plummer
Shawn Plummer claims that "the defendant or insurance company typically owns the annuity policy in a structured settlement.The annuity policy ensures the company remains solvent and can fulfill its obligation to the claimant".
Plummer's explanation fails for the following reasons:
1. It is atypical for a defendant or its insurer to own a structured settlement annuity. A representative of one of the major life insurance companies that has been issuing structured settlement annuities for many years, tells me that less than 5% of transactions are so-called "buy and holds".
One example of where a defendant might own an annuity is where the United States buys and owns structured settlement annuities for claims brought under the Federal Tort Claims Act (FTCA).
2. The annuity policy DOES NOT ensure that the defendant or insurance company remains solvent. If the Defendant were to own the annuity policy and the Defendant were to go bankrupt, the annuitant would be a general creditor of the Defendant.
3. Insurers are highly regulated in each state they are admitted and must maintain reserves. Such reserves are subject to regular statutory filings. But the annuity policy itself does not ensure solvency. Hard to believe that a licensed insurance agent like Plummer would actually publish that.
Why Must Structured Settlements be Court-Approved Fail by Plummer
Shawn Plummer asserts that "The Federal Periodic Payment Settlement Act of 1982 made it mandatory for court approval on all sales of structured settlements to ensure the consumer’s best interest is put first and limit any party from taking advantage of the settlement recipient"
Plummer's assertion is a fail because the plain reading of the Periodic Payment Settlement Act of 1982 says nothing of the sort. See Periodic Payment Settlement Act of 1982 | Birth of Qualified Assignments and Codified IRS Rulings - Structured Settlements 4Real® Blog: Structured Settlements | Settlement Planning News and John Darer Reviews (typepad.com)
On the other hand, per 26 U.S.C. § 5891 - U.S. Code Title 26. Internal Revenue Code § 5891m, a qualified order IS required, in order for a purchaser of structured settlement payment rights to avoid a 40% excise tax on the factoring discount.
IRC section 5891(a) imposes a tax equal to 40% of the factoring discount on any person "who acquires directly or indirectly structured settlement payment rights in a structured settlement factoring transaction that does not qualify for exemption under conditions that are specified in section 5891(b) Source: IRS.gov
Plummer is clearly uninformed about structured settlements and Plummer is not a credible source for information about structured settlements
I've previously reviewed Shawn Plummer's efforts over nearly 2 years that support my opinion that Plummer is clearly uninformed about structured settlements and that Plummer is not a credible source for information about structured settlements.
It's a shame really, because all the correct and accurate information is out there. My interest in the capacity of Structured Settlement Watchdog is to give consumers a clear pathway to accurate information about structured settlements.
John Darer Reviews "Annuity Expert Advice" Website's Multiple Structured Settlement Inaccuracies - Structured Settlements 4Real® Blog: Structured Settlements | Settlement Planning News and John Darer Reviews (typepad.com) February 2023
AnnuityExpertAdvice.Com on Secondary Market Annuity is Just "Plummer's Crack" - Structured Settlements 4Real® Blog: Structured Settlements | Settlement Planning News and John Darer Reviews (typepad.com) February 2022