Who are the parties to a Structured Settlement?
- Plaintiff
- Injured party (or family) is the “Plaintiff”
- Defendant
- Responsible Party for accident
- Insurance Carrier
- Company who insures Defendant
What will a Structured Settlement show?
- Parties to the accident and the respective Insurance Carrier(s)
- Payment Terms of the agreement
- Assignability/non-assignability language
- Terms of the Settlement
- Jurisdiction of the Settlement
- Tax Implications under 104(a)1; 104(a)2 and 130C
What is a Qualified Assignment?
- A qualified assignment is a document that assigns the interest of the original Insurance Carrier to another Insurance Company for the purposes of purchasing an annuity policy to guarantee the declared payment stream
Why is a Qualified Assignment done?
- The Federal Government, specifically the Internal Revenue Service, gives tax breaks to Insurance Companies who structure payouts in the form of future payment streams under Section 130 (C)
- New Companies have been formed for the benefit of realizing the tax breaks given
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