Costs to Consider When Negotiating a Settlement

While the long-term expense resulting from an injury can be significant, it’s impossible to
generalize and each case must be assessed separately in terms of severity and expectations for
recovery. Once the injury’s “time span” has been determined, it’s necessary to evaluate the likely
effect on long-term earning capacity and the rest of the family. Are they the primary
breadwinner? Are there dependent children or elderly parents they help out financially?

Any claims for future expense must be supported by experts, whether or not the case goes to
trial, and there are guidelines concerning who is a qualified expert. For instance, a life care
consultant can attest to diminished life expectancy. Others will need to evaluate earning capacity
or the need for future medical treatment or assistive devices.

Even assessing existing claims against the settlement can get tricky when hospitals, physicians or
private insurers are involved. A hospital, for instance, may not eventually assert its total claim
because of fee structures previously negotiated with Medicare or a private insurer. Or the
hospital may reduce its claims so that they won’t consume so much of the settlement that the
plaintiff has no incentive to pursue a personal injury suit at all.

From their differing perspectives, both the plaintiff and defendant may need to understand the
role that public benefits (Medicaid, Medicare, Supplemental Security Income, Social Security
Disability Insurance) or private insurance could play in deferring future costs.

While the defendant’s attorney obviously wants to limit the size of the settlement, many
jurisdictions consider such funding sources to be “collateral sources,” inappropriate for limiting
liability.

On the other hand, if the defendant has limited resources, it may be important to the plaintiff’s
negotiating strategy to understand other funding possibilities. If a personal injury attorney can
show the client that they can be made whole through additional means, they may agree to a
smaller settlement.

In complex personal injury cases, it can take years to come to settlement and, during that time,
significant debt may be incurred for living expenses. Personal savings and investments may have
been drained, credit cards maxed out and loans undertaken to “tread water” while awaiting
conclusion of the suit. These expenses must be given priority when negotiating the settlement,
because they won’t be covered by public benefits.

The reality is that, in most cases, the defendant’s ability to respond to liability claims is limited
to their insurance. Claims concerning pain and suffering, future earnings and future medical bills
are tough to get covered, making it important to negotiate down existing liens. Medical expense
is the major cause of bankruptcy in the U.S., and this can result if the defendant lacks resources to make the plaintiff whole and the plaintiff doesn’t have their own medical insurance to fill the gap.

Posted on June 21, 2018 .

Independent Life Insurance Company Enters Structured Settlement Market

Some good and interesting news for trial lawyers today. There is a NEW life insurance company that has entered the structured settlement and settlement planning market, Independent Life Insurance Company, and it's very important that trial lawyers be aware of who they are, their business model and why it is important your clients have them as an option when considering a structured settlement. 

This is Mark Wahlstrom, President of Wahlstrom & Associates and this is another in my series on settlement planning for trial lawyers, covering the vital facts and inside information you need to know to make informed decisions for your clients. 

So what is the deal with Independent Life and what do trial lawyers need to know?

1. They are the first totally new entrant into the structured settlement and settlement planning business in almost a decade. In a profession that has seen a steady decline in life companies and funding choices, a new competitor will help to keep pricing competitive and possibly offer new and additional services over time to settlement planners and trial lawyers. 

2. They are the first company that is only going to write structured settlement business. No retail products, no additional lines, but a dedicated focus and purpose to provide structured settlement products and services. This specific focus has certain advantages when it comes to pricing, service and underwriting that should benefit plaintiffs and trial lawyers over time. Plus while they are new, they have a veteran and experienced team that knows structured settlements extremely well and should know how to handle this unique market with out a learning curve. 

3. As a new, smaller company they are going to face substantial competitive pressure from larger, highly rated companies in the structured settlement space, so when they are offered as an option it will be vital for trial lawyers, judges and casualty companies to understand their somewhat unique format as a start up so as to fairly consider their suitability on any particular case. There will be a lot of disinformation so it's important you know the facts as to their business plan, solvency, pricing and service.

4. Why even consider a smaller company like this? Well, because of their new launch they do not have the legacy portfolio and cost issues other traditional markets face, thus creating a situation where they will likely be very cost competitive. If they are the best price value for a client, you will need to consider the value of that price vs the size and reputation of older firms. To do that you need planners who can fully explain and justify their use and as trial lawyers you need to require that back up information for your clients, judges and defendants. 

5. Independent Life is going to be an active advocate for the structured settlement process, even using and innovative grant program to underwrite ideas and tactics to expand and improve the structured settlement and settlement planning space. This has been badly needed as an investment in revenue rulings, ideas and planning as a commitment from life markets has been badly lacking for decades and this alone could drive important changes to improve the process of settlements for injury victims. 

In summary, this is an important and innovative entry into the settlement planning market as most companies have been established life insurance companies who decide to create a structured settlement division. This new start up offers a unique pricing strategy, a veteran management team and a commitment to the settlement planning process that can only benefit injury victims. You'll be seeing and hearing about them and if you have questions you can go to their web site or you can contact me at Wahlstrom & Associates and we can make sure you fairly consider them on cases where they are the appropriate choice for a client. 

Posted on May 10, 2018 .

Independent Life Insurance Company To Focus Exclusively on Structured Settlements

Independent Life Insurance Company, A Texas-based life insurance company announced its launch as the first company of its kind to focus exclusively on the structured settlement market.

Independent Insurance Group consists of two subsidiary affiliates, Independent Life Insurance Company and Independent Life Assignment Company. Independent Life Assignment Company will work with settlement advisors to meet the financial needs of personal injury victims and their families, which will be funded with custom annuities from Independent Life Insurance Company.

The CEO of Independent Life Insurance Company said, “We believe Independent Life’s singular focus on annuities to fund structured settlements will result in excellent service and broker support, as well as upper tier pricing, to improve and help grow the industry.”

Posted on May 3, 2018 .