Structured settlement primary market annuity sales increased approximately seven (7%) percent to $5.134,380,855 in 2013 (compared with $4,819,124,617 in 2012) according to industry estimates compiled and recently published by Melissa Evola. Total 2013 structured settlement cases also increased to 26,533 from 25,038 a year earlier for an average case premium of $193,495.
The 2013 annual premium totals, however, still fall substantially short of the historic 12 month industry high ($6,226,578,725 in 2008) after consistently averaging close to $6 billion annually from 2001-2007.
Adding these 2013 results to historic U.S. structured settlement totals, S2KM estimates the following primary market metrics from 1976 thru 2013:
- Total annuity premium: $139.5 billion.
- Total structured settlement cases: 802,000
- Average annuity premium: $174,000.
Berkshire Hathaway, which re-entered the structured settlement market in 2011 following a multi-year hiatus, assumed primary market leadership by generating $1,424,306,831 of structured settlement annuity premium (28% of the industry total) during 2013.
With announced departures of Allstate and John Hancock during 2013, the U.S. structured settlement market now consists of eight annuity providers. 2013 sales results for other structured settlement annuity providers (per Evola's report) plus the rounded increase (+) or decrease (-) from comparable 2012 results:
- Pacific Life - $848,725,000 (+ $11.7 million)
- MetLife - $726,000,000 (+ $62 million)
- Amgen/USL - $587,367,753 (+ $61.3 million)
- Liberty Life - $558,106,000 (+ $147.3 million)
- Prudential Life - $548,700,000 (- $86.7 million)
- New York Life - $275,253,601 (- $47.5 million)
- Mutual of Omaha - $86,598,027 (+ $29 million)
Evola's 2013 compilation also reports an annual decrease in annuity premium for non-qualified structured settlement assignments (from $170.1 million in 2012 to $164.9 million in 2013) as a portion of the overall structured settlement numbers.
Non-qualified assignments represent transfers of periodic payment obligations that do not meet the requirements of IRC sections 130 and 104(a)(1) or (2) including deferred attorney fees. Despite earlier industry projections of a large and growing market, only two structured settlement annuity providers (AmGen and Liberty) currently offer non-qualified assignments.
Independent industry sources further report a substantial shift in recent structured settlement premium with increasing sales to fund workers compensation Medicare set-aside arrangements (WCMSAs). For S2KM's most recent analysis of structured settlements and WCMSAs, see this prior blog post.
Many industry observers continue to view the United States structured settlement primary market as a strategic, underperforming segment of the larger personal injury settlement planning market. S2KM looked at some of the related issues in a three-part 2013 blog series titled "Growing the Primary Market"