Litigation

A qualified assignment is a transfer of  the obligation to make future periodic payments under a settlement agreement, which satisfies the requirements of Internal Revenue Code (IRC) § 130. In a structured settlement agreement the original obligor (the defendant, insurance carrier for the defendant, or the trustee of a IRC 468B qualified settlement fund, assigns its obligation to make the future periodic payments defined in the settlement agreement to a "qualified assignment company". Generally a qualified assignment company is a special purpose company, which does little more than hold an annuity or United States Treasury obligations as a "qualified funding asset" to back up the obligations it assumes from Defendants, Insurers or qualified settlement fund trustee. A qualified assignment company may actually be an insurance company itself. When an annuity is used as a qualified funding asset, the qualified assignment company is usually related to the life insurance company issuing the structured settlement annuity. In such cases, the qualified assignment company typically purchases an annuity from the related life insurance company as a qualified funding asset pursuant to IRC 130(d). A qualified assignment requires the plaintiff's consent.

Plaintiffs and their attorneys who engage settlement consultants who hold themselves out as plaintiff specialists or settlement planners have a reasonable expectation that those settlement consultants deliver accurate and reliable information.

The answer to the question "what is a qualified assignment" should be fundamental knowledge to ALL competent structured settlement consultants and users of structured settlements. It is therefore quite a pity that there is misinformation posted on the website of a veteran plaintiff focused NSSTA member which states incorrectly (see below) that the qualified assignment is "to a financially secure insurance company", or "an assignment to the life company".