Purchasing structured settlements as investments
You may have heard it’s possible to buy the rights to another person’s structured settlement payments to get fixed income with a great yield. Below, we explain what kind of asset it is, how it compares to other fixed income assets, and how to connect with our platform to consider purchasing a structured settlement.
What is a structured settlement?
A structured settlement is an alternative to an immediate lump sum payout after the conclusion of a lawsuit. This settlement planning tool provides plaintiffs with periodic payments instead of receiving the entire settlement at once. Structured settlements have some benefits in guaranteeing tax-free future income for individuals who can no longer work. It also often appeals to defendants for a number of reasons. This process was made possible in 1982 when Congress amended the federal tax code. The Periodic Payment Settlement Act of 1982 (Public Law 97-473) was a means of formally recognizing and encouraging the use of structured settlements in physical injury and wrongful death cases.
Sometimes an individual with a structured settlement annuity needs a large sum of cash immediately. If they qualify legally to do so, they may transfer the rights to their future structured settlement payments to an institution or another person – a “buyer” – in exchange for cash.
How does a structured settlement stack up as an investment?
Crowfly provides qualified individuals with access to guaranteed structured settlement annuity payments. As described above, individuals who need funds now can transfer the rights to future payments at a discount. The end result for the buyer is a defined set of guaranteed payments from top-tier insurance companies with a great yield.
Investors like you who are looking for fixed income investments often look to treasuries, bonds, municipal bonds, or annuities. Structured settlement annuity payments are guaranteed by an insurance company’s annuity policy, just like you would purchase from the insurance company directly. The rights to payments from someone else’s policy are simply transferred to you. So you’ll end up with payments with the same safety as an annuity that you would purchase on the market, but at a discount – meaning you get a higher yield.
How to purchase a structured settlement
CrowFly has streamlined the buying process by directly connecting pre-vetted buyers like you with structured settlement assets on an online platform. The process minimizes the transaction cost of a pass-through agent. You pay less for the asset, and annuitants receive more for their settlement. It’s a win-win that also performs a social good by improving outcomes for injured individuals with urgent financial needs.
The process begins when you submit your information to CrowFly through our secure online portal for our team to review and approve. We ensure every potential buyer is an eligible purchaser. This includes a background check validating your personal information to ensure that we accurately know who you are.
Once our team has determined you are eligible to buy the rights to structured settlement payments, we will grant you access to our platform. It includes resources to find and initiate the transfer of available assets.
Table 1. Example of structured settlement assets listed on our platform.
Browsing is free, anonymous, and easy. CrowFly provides the necessary tools to support the process and the data needed to make an informed decision. We encourage all buyers to consult with a financial advisor. CrowFly will provide access to these resources and data, but not financial recommendations.
Once you find an asset that fits your investing needs, we will ask you to work through our Purchase Wizard. This task includes reconfirmation of your intention to buy, adherence to legal terms, and proof that you have appropriate funds to finalize the deal. In some cases, we may need to collect a deposit.
Once a transaction is finalized, you will receive a full closing book for your records with the annuity policy details, the court order insurance acknowledgement, and other materials for your records. Then -- like with other fixed income assets -- sit back, collect your payments, and enjoy high yields. Visit crowfly.com/buyers to get started today.