How satisfied with their structured settlements are injury victims (and their attorneys) who have opted for structured settlements instead of, or in addition to, lump sum alternatives?
As part of S2KM's series discussing structured settlement metrics and analytics, this blog post addresses that question by summarizing selected results from three structured settlement surveys related to customer satisfaction:
- NSSTA 2006 Survey - as summarized during both the National Structured Settlement Trade Association (NSSTA) 2007 Winter Meeting and 2007 Annual Meeting;
- AIG 2007 Survey - as reported on the AIG website and summarized during the NSSTA 2008 Annual Meeting.
- J.G. Wentworth 2008 Survey - as reported in a press release on October 29, 2008 and a media report on November 5, 2008.
In prior blog posts, S2KM examined structured settlement "quality" and "performance" metrics and analytics in the context of a 2011 National Litigation Management Study sponsored by the Council on Litigation Management (CLM). That study identified structured settlement as the "most penetrated external initiative" among 30 litigation-related service areas analyzed based upon interviews with leading litigation management executives.
In a subsequent blog post, S2KM will provide commentary and suggest conclusions about customer satisfaction with structured settlements based upon the results of the three surveys.
NSSTA Survey - The National Structured Settlement Trade Association (NSSTA) survey consisted of attorneys involved in structured settlements (43 telephone surveys) and structured settlement recipients (1275 telephone and Internet surveys). Titled: "A Study of the Structured Settlement Process Conducted on behalf of the National Structured Settlement Trade Association", the survey was directed by Robert E. Hoyt, the Dudley L. Moore, Jr. Chair of Insurance at the Terry College of Business at the University of Georgia. Among the results:
- Structured settlement recipients:
- 65% said they had not heard about structured settlements prior to settlement.
- Most were uncertain whether a structured settlement consultant was involved with their case.
- 34% recalled receiving educational information while 75% of this 34% said the information was helpful.
- 66% first learned about structured settlements from their trial attorney.
- 75% said they were very happy their settlement included structured settlement annuities.
- 75% said they would recommend a structured settlement.
- Attorneys involved in structured settlements:
- 95% said they are proponents of structured settlements.
- 70% said they retain a structured settlement consultant at least for some cases.
- When asked: "Whom do you prefer to use for purposes of financial planning for your clients?", the attorneys responded:
- 30% - Trust company/department.
- 28% - Financial planner.
- 23% - Structured settlement consultant.
- 19% - No response.
AIG Survey - Conducted by Esearch.com, Inc., the AIG survey included 1000 U.S. participants. 80% of the participants had no connection with any personal injury case while 20% had previously been involved directly or indirectly through a family member in a personal injury case. Participants who had no connection to a personal injury case were asked to read two hypothetical scenarios and answer questions on how they would react. Those with a direct connection to a personal injury case were not only asked to read the hypothetical scenarios, but also to answer questions based upon their real life experience.
- In AIG's first survey hypothetical, AIG provided no information about structured settlements. Results:
- 65% of respondents said they would elect a lump sum of which
- 49% said they believed they could make their own long term decisions and
- 26% said the lump sum was more appropriate to pay bills and pay off debt.
- In AIG's second survey hypothetical, AIG provided survey respondents with information about structured settlements - presumably this "AIG Backgrounder" which AIG features on its website. Results: 73% of respondents said they would elect a structured settlement.
- 206 of 1000 participants said they or their family had been involved with a personal injury case. Results for those 206 participants:
- 86% had elected lump sum.
- 57% said they were unaware of structured settlements.
- 64% said their attorneys did not inform them about structured settlements.
- 57% of those that elected a lump sum said their settlement funds were already depleted.
- 71% of respondents who said they favored a structured settlement did so "to provide a regimented stream of income designed to cover expenses".
J.G. Wentworth Survey - The J.G. Wentworth survey consisted of 115 participants who had previously sold some or all of their structured settlement payment rights to Wentworth and focused upon the reasons they: 1) agreed to a structured settlement; and 2) subsequently sold (transferred) some or all of their structured settlement payment rights. According to a J.G. Wentworth marketing executive, the survey resulted from recommendations made at the 2008 Structured Settlement Thought Leadership Conference. Relevant questions and results:
How many years ago did you settle your original lawsuit?
- 70.9% - More than 10 years ago.
- 14.5% - 5 to 10 years ago.
- 13.6% - 1 to 5 years ago.
- 0.9% - Past 12 months.
When you settled your original lawsuit, why did you accept payments over time rather than a single lump sum of cash?
- 23.4% of the participating structured settlement recipients said they never were given a lump sum option.
- 38.3% had been minors whose settlements were approved and/or selected by judges and guardians.
- 38.3% of the respondents offered the following reasons for accepting a structured settlement:
- 23.4% - Payments over time seemed like a better deal.
- 7.4% - Not sure I could manage a large amount of cash.
- 6.4% - To pay future medical expenses or special needs.
- 1.1% - Faster way to settle.
How satisfied are you that you accepted a structured settlement?
- 25.0% - As a minor, a structured settlement was considered the best option.
- 24.1% - Mostly satisfied.
- 21.3% - Neither satisfied nor dissatisfied.
- 18.5% - Completely satisfied.
- 6.5% - Slightly dissatisfied.
- 4.6% - Completely dissatisfied.
Do you wish you and your attorney had negotiated for a single lump sum settlement?
- 31.5% - No.
- 27.8% - As a minor, I was unable to negotiate my settlement terms.
- 20.4% - Maybe.
- 10.2% - Yes.
- 10.2% - I don't know.
When you settled your original lawsuit, how well informed were you about structured settlements?
- 30.5% - Due to my status as a minor, I was not informed.
- 27.6% - Very well informed.
- 24.8% - Not well informed.
- 17.1% - Well informed but still had questions post-settlement.
Why did you sell all or part of your structured settlement?
- 60.2% - Pay bills.
- 8.3% - Start a business.
- 8.3% - Home improvement.
- 5.6% - Pay for education.
- 5.6% - Cash made more sense than waiting.
- 4.6% - Buy a house.
Did selling your structured settlement help solve your financial problem?
- 40.7% - Mostly.
- 32.4% - Yes.
- 21.3% - Only helped a little.
- 5.6% - No, it did not help.
Would you sell payments again?
- 36.3% - Maybe.
- 30.1% - No.
- 18.6% - Yes.
- 8.0% - Probably.
- 7.1% - I have already sold all of my payments.
If you sold only part of your settlement, do you plan to keep the rest of your payments as a structured settlement?
- 42.3% - Yes.
- 35.1% - I don't know.
- 9.0% - No, I plan on selling all of my payments.
- 8.1% - I already sold all of my payments.
- 5.4% - No, I plan on selling some of my payments.
For complete S2KM reporting and commentary about structured settlement metrics and analytics, see the structured settlement wiki.