Structured Settlements were incredibly resilient during the financial “firestorm” of 2008. It’s important to analyze why the industry did so well. As a matter of fact, structured settlement clients received exactly what was promised to them, to the penny.

Family holding hands Family holding hands

Here’s why Structures were so resilient:

Highly Regulated

  • Structures are a highly regulated and secure investment option and remained so even during the recent financial melt-down. Stringent state law regulations demand that there is always enough money in reserves to pay annuitants. As a matter of fact, most providers have billions of dollars in surplus.
  • State insurance laws require all insurers to establish “reserves” for every obligation they assume, and these laws have worked. “When it came to agencies’ assessments of insurer’s ability to pay policy holders, they did a pretty darn good job.” (Wall Street Journal, April 27th, 2009)
  • In addition to the minimum requirements insurers typically maintain additional capital referred to as excess capital and surplus.
  • Insurance company funds are protected by insurance regulation. For example, AIG’s parent company could not access the annuity division’s funds. In October 2008, the Insurance Superintendent of New York pointed-out that, “The AIG situation is a great example of state regulation at work. Their policy holders were never at risk.”


  • Structures are invariably preferred by the Courts for cases that involve disabled adults or minors. Those who are most vulnerable are strongly encouraged by the Courts to utilize this option. This truly speaks to the safety of structures.
  • For all the reasons outlined above, the industry remained incredibly resilient and strong during the worst financial crisis since the Great Depression.

It’s clear that Structured Settlements maximize the value of one’s investment portfolio due to the taxfree nature of the payments, which is a highly attractive feature. However, especially during times of economic uncertainty, the legal protections and unwavering guarantees that are wrapped around structured settlements make them a perfect investment choice.