The National Academy of Elder Law Attorneys (NAELA) is an important trade association (for the structured settlement industry) of which this author is a relatively recent (2006)
member. Among its strengths, NAELA sollicits and sponsors legal
scholarship addressing a wide variety of topics. This legal scholarship is primarily directed
toward NAELA's approximately 5000 elder law attorney members nationally including hundreds of special needs attorneys.
Unfortunately for the structured settlement industry (and also NAELA members), NAELA's legal scholarship does not include structured settlements.
The most recent example of this scholarly omission (or at least neglect) is NAELA's Annuity Policy White Paper ("Annuity Policy: Consumer Protection Issues and Public Policy Recommendations") prepared by the NAELA Annuity Task Force and published in the hardcopy NAELA Journal Volume 3; 2007; Number 1.
Members of NAELA's Annuity Task Force are identified in the White Paper as: Michael A. Flory, Esq., Chairman, Michael J. McGuire, Esq., Donald M. McHugh, Esq., John B. Payne, Esq., and Shirley B. Whitenack, Esq. - "with special thanks to Donna Rainville".
NAELA's Annuity White Paper contains two references to structured settlements with no additional reference to or discussion of any structured settlement annuity laws or legal issues.
- The first reference to "structured settlements" appears in a section titled "Immediate v. Deferred Annuities": "Immediate annuities (lifetime, fixed term and minimum term) are useful to supplement income and quite often settlements in lawsuits are annuitized, or 'structured' ".
- The second reference to "structured settlements" appears in a section titled " 'Noncommutable' and 'Non-assignable' Annuities" related to a 2005 New Jersey Medicaid case, "Estate of F.K. v. Division of Medical Assistance and Health Services": "The appellate court held that the burden of proof of a secondary market is on the state agency, not the applicant, and the proofs submitted by state agency of a secondary market (i.e. internet websites advertising sales of structured settlements and lottery winnings) did not meet the burden of proof."
Otherwise, the NAELA Annuity White Paper (about public policy and consumer protection) makes no direct or indirect reference to structured settlement annuities or structured settlement laws - including the 46 state structured settlement protection statutes.
From a structured settlement perspective, here are recommendations for NAELA's Annuity Task Force related to specific sections of their current White Paper.
Purpose of the White Paper
- Include references to structured settlements, personal injury settlement planning and special needs planning - all of which involve seniors and annuities.
- Provide more thorough analysis of the secondary annuity markets including the secondary structured settlement annuity market.
- Be more specific about identifying
- the federal and state laws related to annuities - including structured settlement annuities and the structured settlement secondary market.
- existing public policy related to annuities - including structured settlement annuities and the structured settlement secondary market.
- Be more specific and expansive about the public policy and legal conflicts that currently exist between tax laws and public policy and government benefit laws and public policy
- Address annuities (including structured settlement annuities) within the context of these laws and public policies:
- Tax law;
- Government benefit law;
- Consumer protection law;
- Include structured settlement annuities and the secondary annuity markets among the NAELA White Paper's recommendations.
Elements of the White Paper - Each of the following elements should address structured settlement annuities and the secondary annuity markets:
- Understanding Annuities
- Medicaid Planning with Annuities
- Consumer Protection Issues
Understanding Annuities - This section should include additional specific subsections addressing:
- Structured settlement annuities
- Secondary market for annuities
- Taxation of annuities - including structured settlement annuities
- Lifetime annuities - including substandard age ratings and some discussion of "actuarially sound" related to lifetime annuities.
- Financial ratings and rating agencies - how can a White Paper about annuities not address financial ratings and financial rating agencies when discussing "The Risk Factor" of annuities?
Medicaid Planning with Annuities
- Why not identify or equate this section with special needs planning and personal injury settlement planning.
- Differentiate and define the two planning professions and, in that context, address structured settlement annuities and the secondary insurance markets.
Annuity Laws -include some reference to existing structured settlement annuity laws:
- Federal tax laws
- State structured settlement protection statutes
- State periodic payment of judgment statutes
Consumer Protection Issues
- Include some reference to federal structured settlement tax laws and state structured settlement protection statutes.
- Identify structured settlement legislation as one example of existing consumer protection for annuities.
Structured settlement laws and legal issues have slipped between the intellectual cracks of elder law and special needs law. The NAELA Annuity Policy White Paper represents a continuing example of this unfortunate neglect. NAELA possesses incredible collaborative knowledge about annuities - some of that knowledge should be directed toward educating NAELA members about structured settlement annuities and the secondary insurance markets.
Contact NAELA for copies of NAELA's Annuity Policy White Paper.
For prior, related S2KM's blog posts, see:
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