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When Is Proof Of Birth Needed For Structured Settlement Annuity?

by John Darer CLU ChFC MSSC CefT RSP CLTC

Proof of birth is needed when a structured settlement includes lifetime or life contingent payments, or the structured settlement payee is a minor, the structured settlement annuity issuer requires proof of birth.

Sample proof of birth

Why is proof of birth necessary when a structured settlement is established?

• Lifetime payments and life contingent payments represent an increased risk for an insurance company because they they must first estimate how long an annuitant will live and must maintain adequate reserves. The insurers set the price of the life contingent structured settlement annuity based on a confluence of factors that include normal life expectancy and possibly medical records which might result in a rated age.   It is essential that the date of birth for the measuring life be correct. The measuring life is the life of the person on whose life the annuity will be contingent.    The measuring life differ from the payee in some cases. For example if the structured settlement payments are feeding into a special needs trust
• Some people lie about their age on insurance applications. Sad but true.
• Structured settlement payments to minor's generally do not begin until the minor reaches the age of majority.  The annuity issuer and the parties should be sure when the deal is consummated when the age of majority really is.

What proof of birth is acceptable?

Proof of birth can generally be copy of an active drivers license, copy of birth certificate, active passport or other government issued identification.

Lasy updated December 10, 2023

 

 

 

Rated Ages and Structured Annuities, Structured MSA and Structured Judgments - Part 2 Video Podcast

by John Darer CLU ChFC CSSC RSP

In second part of a two part series which explores rated ages and the challenges of impaired risk underwriting for structured settlement annuities John Darer's special guests include Rosemary Brindamour, Chief Medical underwriter for John Hancock Life Insurance Company (U.S.A.) and John Hancock Life Insurance Comapny of New York, and Robert Shavelle PhD of the Life Expectancy Project. The podcast was stimulated by the Ron Houben case in which the patient was initially diagnosed as being in a persistent vegetative state for many years but later was discovered to be in a locked in syndrome.

Link to Part 1 of our podcast series on Rated Ages and Structured Settlement Annuities, Structured MSA and Structured Judgments

More on Rated Age and Structured Settlements

Learn more about the Ron Houben, the Belgian man misdiagnosed for 23 years as being in a persistent vegetative state

Longer Rated Age Response Times From Structured Annuity Issuers

by John Darer® CLU ChFC CSSC RSP

Rated age requests are trending tiwards a longer response times following submission of medicals  . What was once the matter of several hours is now taking 24-48 hours in some cases. Whether the cause is a matter of a trimmed work staff, or a flood of workers comp medicals clogging up the system, the delays are something that now needs to be planned for in advance.

A rated age is an important component of a structured settlement pricing when there are life contingent payments such as:

• Pricing out a life care plan
• Providing a back stop to a special needs trust or  to an investment strategy
• Funding the deferred component of a Medicare Set Aside Trust (MSAT) at the maximum discount
• Funding the temporary life elements of a New York 50A or 50B Structured Judgment
• Funding lifetime retirement benefits or any other lifetime payment stream

Brokers and their staff are encouraged (if they do not already do so) to take the time to review the medicals that they send before they send them. This helps to eliminate redundant reports and may identify salient points for the underwriter's consideration. Perhaps there will be enough resulting time saved to help speed up response times.