Among other valuable discussions at the NSSTA 2009 Winter Meeting, Joseph DiGangi's presentation titled "Comprehensive Settlement Consulting in the 21st Century" was the most provocative and important. DiGangi's presentation was enhanced by his excellent visual illustrations and diagrams. DiGangi is President of Millennium Settlements and a NSSTA member.
In what he termed "a wake up call for the industry", DiGangi criticized the traditional structured settlement business model and knowledge standards. He also outlined his vision for industry transition, improvement and growth which he termed "comprehensive settlement consulting".
DiGangi characterized the current structured settlement industry as "a stagnant market" based upon an outdated "annuity broker" business model. Structured settlement clients and competitors, according to DiGangi, share negative perceptions about structured settlement consultants. As examples of negative perceptions, DiGangi cited the industry's single product offering and limited knowledge base.
As an alternative to the "annuity broker" structured settlement business model, DiGangi proposed a "consultant" model ("comprehensive settlement consulting") with multiple products and services providing added value for, and with, other settlement stakeholders.
Characteristics of DiGangi's settlement consulting model:
- Planning orientation;
- Solutions before products;
- Blended products and services;
- Product neutrality;
- Compensation disclosure;
- Professional training and designations;
- Comprehensive skill sets and knowledge base.
DiGangi highlighted several transitional issues: licensing; conflicts of interest; collaboration models; and work process infrastructure.
For structured settlement consultants who lack the expertise, licensing or infrastructure to offer comprehensive solutions, DiGangi recommended teaming up with other professionals.
Using a hypothetical case example, DiGangi explained settlement consulting as a multi-stage process:
- Needs assessment
- Design
- Implementation
- Monitoring.
The core financial product for DiGangi's hypothetical settlement plan was a structured settlement annuity. DiGangi characterized structured settlement annuities as the "foundation product" for settlement consulting - and settlement consulting as the new business model for structured settlement growth.
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