A Special Message for Plaintiff Attorneys
Of the approximately 400 full-time structured settlement brokers in the United States, there are only a handful who believe in the plaintiff’s right to select the person who will handle most likely the biggest financial transaction of the plaintiff’s life. We believe in that right!
Most brokers have alliances with the casualty insurers, and that means they have a conflict of interest in working on behalf of your client. A lot of defense brokers even pay kickbacks to the casualty insurers for the privilege of being forced upon your client.
Some self-insured defendants and casualty insurers offer structured settlements during negotiations to resolve physical injury and workers’ compensation claims because they genuinely believe the injury victim deserves the significant tax benefits intended by Congress. If that is the only reason they are offering a structured settlement – because they truly care about your client – then they should have no objection to your insistence on the right of your client to engage his or her own structured settlement consultant to handle the transaction, including the annuity selection and purchase.
If the defendant or casualty insurer insists that its in-house structured settlement operation or its “approved” broker will handle the structure “or else your client takes cash,” it has some reason other than the best interest of your client at heart.
Here are some of the possible reasons the defense wants to control:
1. The defense intends to use structured settlement proposals, without divulging the cost or the name of the proposed annuity issuer, to lead you and your client to believe the offer was larger than it actually was. The involvement of your broker neutralizes that tactic.
2. The defense intends to save more money, even after the plaintiff has agreed to settlement terms, by reducing the represented cost of the future periodic payments. This is done by comparative shopping, obtaining daily rates and a rated age for impaired life expectancy.
3. The defense intends to reward its broker for assisting in the strategy to use structured settlements as a defense tool. The defense and the defense-loyal broker know that not all cases will structure, but the broker has been promised the “right” to handle any structures that result from the negotiations, just for being available.
4. The self-insured defendant or casualty insurer has a kickback arrangement with the defense-loyal broker – a secret rebate – that will further reduce its cost.
Not one of these reasons is beneficial to your client. Some are detrimental and certainly not in your client’s best interest. You do not have to allow the defense to be in control. Why would you even consider it?
Most defense-loyal brokers do not have the time or interest in making sure the structured settlement transaction considers all factors of concern to your client. After all, the defense-loyal broker has no duty to your client and, in fact, has a conflict of interest in serving your client. The defense broker will be released from all future liability when your client releases the tortfeasor, the casualty insurer and all of their agents. How will you respond when those embarrassing questions are asked afterward? Will you have a legal malpractice exposure?
If any of this concerns you, there is a remedy. You and your client can engage a structured settlement specialist who has a true interest in providing to the plaintiff the significant benefits Congress intended should be available to physical injury victims.
If you will obtain from the defense, as a precondition of any negotiation, their agreement that you will control the structured settlement transaction, there is no cost to you or your client for our services. We will be compensated by the commission from the annuity sale.
If you want to provide a consultant for your client who will bear responsibility for his actions after the defendant has been released, resolve this issue before you talk about numbers – not afterwards when the defense knows they have the advantage.
We don’t pay kickbacks to defendants or to casualty or excess liability insurers.
We have access to all major, highly rated structured settlement annuity markets.
We carry in errors and omissions professional liability coverage.
We will remain responsible for our actions.
For your own protection and the protection of your client, call on us!