September 12, 2018 - When the average person hears "structured settlement," they often associate the term with TV commercials offering "CASH NOW!" for something they're led to believe is being withheld from some poor taken-advantage-of individual by an unscrupulous insurance company.
Most intuitively recognize these ads for the disingenuously self-serving sales pitches they are and understand these companies aren't just making public service announcements for the common good of society.
Imagine buying a $100 bill for $40 and then turning around and selling it for $80 and you get some sense of how profitable this industry can be and why, in 2012,
Google's most expensive Adword
was "structured settlement."
Things Are Better, Yet Problems Remain
This "factoring" industry, as it's customarily called, has come a long way from the early days of structured settlement exploitation thanks in large part to the passage of Structured Settlement Protection Acts in many states and from increased competition among settlement purchasers.
Structured settlements have enriched the lives of many people over the past forty-plus years by providing guaranteed tax-free income to help them meet their ongoing care and support needs and helping them lead lives of dignity.
But there are legitimate situations where, despite the best of intentions when originally implemented, the terms of a structured settlement no longer seem appropriate for the injured party or their beneficiaries. In these instances, having the option to convert funds to immediate cash can be critical to adjusting to a new financial hardship and should be available.
But consumers shouldn't be fleeced in the process.