During the past two months, S2KM attended and reviewed three national conferences that featured settlement planning issues:
- ASNP 2012 Annual Meeting
- Risk Settlement Planning Practicum - see also: Structured Settlements and Settlement Planning
- SSP 2012 Annual Meeting
In addition to many technical and product presentations (identified and/or summarized in the above links), what did attendees learn about fundamental settlement planning issues? And what fundamental issues still need to be addressed more directly at future conferences before settlement planning becomes a recognized profession?
Definitions - Three conference participants offered definitions for "settlement planning" and/or "settlement planner":
- Joseph Tombs - "Settlement planning is a profession helping recipients of settlement proceeds use those proceeds to achieve post-loss goals and transition successfully to post-settlement financial life. Settlement planners represent a blend of several professionals: part tax lawyer, trial lawyer, special needs lawyer, financial planner, annuity specialist, social worker, and medical case worker."
- Timothy Morbach - "Settlement planning requires due diligence and informed consent. In that context, settlement planning provides a framework within which settlement stakeholders are able to craft case-specific terms and conditions, legal documents, financial instruments, plus related work product, to resolve claims and achieve safe harbor reflecting their respective best interests."
- Patrick Hindert - "The primary difference between special needs planning and settlement planning is that special needs planning includes clients whose disabilities result from many causes including but not limited to personal injury or workers compensation accidents."
- Note - "Rule 1: Terminology" in the SSP Standards of Professional Conduct provides multiple definitions related to settlement planning including the following for "settlement planner": "a representative who provides advice and other services to a person participating in the design, negotiation or implementation of a settlement or satisfaction of judgment for the benefit of a person claiming a legal entitlement to an award of damages or other compensation. A settlement planner may represent a plaintiff, a defendant, an insurer, a guardian ad litem, an heir of a claimant, an attorney or another person participating in the settlement process."
Emergent Profession - Several conference speakers who discussed settlement planning from a structured settlement perspective described settlement planning as a larger and more complex successor business and profession:
- Joseph DiGangi - "Today we find our industry at a crossroad. In order to move forward, our only choice is to build great business models around the planning first approach. Settlement planning represents a needs-based consultative business model based on benefits, not products."
- Joseph Tombs - "Selling structures is easy. Expectations are low. Any primate can run quote software. A fixed annuity is one of the most simple financial products in the world. We are building a new profession that requires constant education and practice standards. Settlement planning increases expectations and potential liabilities. The more we study and practice settlement planning, the more we realize its complexity and understand its challenges."
- Charles Schell - "The Claims Management model benefits the settlement planning industry and Settlement Planners should acknowledge the benefits which include product marketing and continued protection of IRC sections 104(a)(2) and 130. Concurrently, defense brokers should recognize the benefits of collaborating, rather than competing, with Settlement Planners. These benefits include access to and trust of the customer, an awareness of financial needs and family issues plus multi-product financial solutions that feature structured settlements and enhance their sale."
- Jack Meligan - "SSP and its members have been promoting the practice of Settlement Planning as a more comprehensive solution for the financial issues facing personal injury victims and their families, and the profession of Settlement Planning as the next evolutionary step for members of the financial and legal communities that serve these injured Americans."
- Patrick Hindert - "The structured settlement business models that seem "normal" today began with a choice that made sense in the late 1970s and early 1980s. They have survived despite changes impacting the justification for that choice. Settlement planning is an emergent system in which many different elements interact. Settlement planning is producing a new business model that is influencing all of its constituent elements including structured settlements."
Multi-Professional - The professional backgrounds of conference participants provides some indication of an emerging community of professional practice and its collective knowledge base:
- Special Needs Attorneys - Michele Fuller, David Lillisand; Kevin Urbatsch; Rene Reixach; Jason Lazarus; Annette Hines; Linda Brown; Vincent Russo; Michael Amoruso; Harry Margolis.
- Tax attorneys - Robert Wood; Jeremy Babener; David Higgins.
- Miscellaneous attorneys - Professor Carl Pierce; Richard Risk; Daniel Hindert; Patrick Hindert; Karen Meyers; Mark Popolizio; Steve Riley.
- Settlement Trustees - Travis Finchum; Frank Maguire; Christi Fried; Wesley Cosgriff; James Creel.
- Financial and insurance professionals - Jack Meligan; Charles Schell; Joseph Tombs; Joseph DiGangi; Mark Wahlstrom; Mal Deener; Timothy Morbach; John Woolway; Robert Noack; Paul Hansen; Major General James W. Comstock; Anthony Prieto; Robert Birney; Jerry Hulick.
- Medicare Set-Aside Specialist - Douglas Shaw.
- Lien Resolution Specialist - Daniel Alverez.
- Note: none of the conferences featured guardian ad litems, life care planners or damage allocators as speakers.
Unanswered Questions - From S2KM's perspective, future settlement planning conferences need to more directly address the following issues:
- How large is the United States settlement planning market?
- Who comprises (and selects) the settlement planning team?
- What criteria and process (e.g. request for proposal) are appropriate for selecting members of the settlement planning team?
- What professional licenses and certifications are applicable?
- What primary laws and regulations apply to settlement planning?
- What work product does each settlement planning team member provide?
- Who integrates their individual work product into a settlement plan - and how?
- When is a settlement plan appropriate?
- What are the standard components of a settlement plan?
- What are the product suitability and disclosure standards for settlement planning?
- What does a settlement plan cost?
- What other metrics (besides cost) are appropriate for evaluating the success of a settlement plan?
- How are settlement planning team members compensated?
- What alternative compensation methods and/or business models would allow settlement planning to become more efficient and/or reduce costs?
- Once implemented, who has responsibility to monitor and/or amend the settlement plan?
- What are the Defendant’s responsibilities and duties in settlement planning?
For professionals and product providers interested in learning more about settlement planning, see: