Introduction
Structured settlements were created to protect vulnerable personal injury claimants by ensuring long-term, tax-free financial stability. Yet today, those same settlements are increasingly targeted by an aggressive and evolving secondary market. In 2024 alone, the structured settlement industry sold a record $9.5 billion in annuities, underscoring the growing size and significance of this market—and the urgent need to defend its integrity.
This article examines two recent appellate decisions—White v. Symetra and Cordero v. Transamerica—that expose systemic risks in the structured settlement market. These cases reflect opposite extremes: issuer overreach and issuer disengagement. Together, they illustrate how procedural safeguards alone are insufficient to prevent exploitation. In response, Independent Life’s Payee Protection Policy (PPP) offers a proactive, ethical framework for reform that preserves the original promise of structured settlements.
When Issuers Become Buyers: The Dangerous Dual Role
On June 20, 2024, the Ninth Circuit Court of Appeals reversed a lower court decision in White v. Symetra Assigned Benefits Service Company, which had certified two nationwide classes of annuitants who alleged they were wrongfully induced into structured settlement factoring transactions. The ruling turned on class certification issues, not the merits, but still offers critical insight into the dangers of issuer involvement in the secondary market.
Symetra, unlike most factoring companies, played a conflicted dual role: it was both the original issuer of structured settlement annuities and a buyer of its own annuitants’ future payment rights. After ceasing the sale of new annuities, Symetra pivoted to purchasing payment streams from its own payees, often at steep discounts. Plaintiffs argued this represented a profound conflict of interest, as the company designed settlements for long-term financial security and later dismantled them for profit.
Symetra’s communications arguably compounded this ethical concern. In solicitations, it described itself as a “trusted friend” and “advocate,” blurring the line between fiduciary responsibility and commercial self-interest. As a prior Independent Life article noted, “[Symetra’s] solicitations were not only frequent but framed to appear as financial guidance from a partner, not a counterparty.”
Plaintiffs’ Diverging Stories Undermine Class Certification
The Ninth Circuit denied class certification, emphasizing that the plaintiffs’ experiences were too individualized. Renaldo White had participated in prior factoring deals and affirmed the Symetra transaction in a sworn affidavit. Randolph Nadeau completed four transactions with Symetra over 14 years, acknowledged its profit motive, and rejected alternative financing. These divergent narratives meant that proving causation would require thousands of mini-trials, undermining the predominance requirement for class certification.
The court also noted that each transaction had been approved under a state Structured Settlement Protection Act (SSPA), emphasizing that judicial findings of voluntariness and understanding must be considered in any causation analysis.
Class Settlement Approved in White v. Symetra
On March 4, 2025, following remand from the Ninth Circuit, the U.S. District Court for the Western District of Washington granted preliminary approval of a nationwide class action settlement in White v. Symetra. The settlement class includes annuitants who sold life-contingent structured settlement payments to Symetra’s affiliate, SABSCO, despite anti-assignment language in their original settlement agreements.
The court found the $2.175 million settlement fair, reasonable, and the product of arm’s-length negotiations after substantial litigation and discovery. The court also approved a comprehensive notice program and set a final fairness hearing for July 28, 2025. While class certification was previously denied on predominance grounds, the settlement underscores the systemic nature of the issues raised—specifically the risks posed when original obligors later act as secondary market buyers.
Unregulated Conflicts: How the System Enables Abuse
Symetra’s transition from obligor to secondary market buyer represents a regulatory blind spot. SSPAs were designed to protect annuitants from third-party factoring companies, not from issuers leveraging their unique relationship and insider knowledge to solicit discounted buybacks.
At settlement, annuitants understandably view the issuer as a neutral fiduciary. Symetra’s post-hoc reemergence as a buyer—without prior disclosure or consent—violated this expectation and exploited institutional trust. Courts evaluating “best interest” petitions often lack visibility into such conflicts.
This is not a case against issuer involvement per se. Rather, it’s a call for transparency, consent, and ethical consistency. Independent Life’s PPP exemplifies that path: structured, principled, and payee-centric.
The Hands-Off Approach: Insurer Disengagement in Practice
White showed the dangers of issuer intervention. Cordero v. Transamerica, decided by the Eleventh Circuit, illustrates the opposite failure: issuer inaction.
Lujerio Cordero, a cognitively impaired annuitant, entered into six factoring transactions, selling approximately $960,000 in future payments for just $268,000. Despite the apparent disparity and repeated sales, each transaction was approved by a Florida court under the SSPA. His family submitted affidavits attesting to his incapacity.
Cordero sued Transamerica, alleging it breached fiduciary and contractual duties by failing to enforce anti-assignment clauses or intervene. The court sided with Transamerica, holding that the company had no duty to police the secondary market post-assignment. The structured settlement had been transferred to an assignment company, ending the issuer’s responsibilities.
The decision may follow the letter of the law, but as Independent Life noted in an earlier article, “it failed the principle promise of structured settlements: long-term security.”
When Formalism Fails the Vulnerable
The Cordero case reveals how legal formalities can obscure systemic failures. Judicial oversight, anti-assignment clauses, and procedural requirements mean little when no party has a duty to act. In contrast to Symetra’s overreach, Transamerica’s disengagement allowed repeated exploitation of a vulnerable individual.
This passive model places too much faith in court proceedings and too little responsibility on industry stakeholders. It highlights the need for voluntary standards that go beyond mere compliance.
A Better Way: Independent Life’s Payee Protection Policy
Faced with these dual failures, Independent Life has adopted a middle path: proactive, principled engagement without profiteering. The Payee Protection Policy (PPP) was designed to protect annuitants while respecting their autonomy.
Key Components:
· Notification and Outreach: Independent Life contacts the original consultant and annuitant when a structured settlement transfer petition is filed.
· Independent Review: Transactions are screened for red flags including repeat sales, cognitive concerns, high discount rates, or forum shopping.
· Transparent Objection Standards: The company generally objects to transfers with a discount rate exceeding Prime + 5%.
· Court Intervention: Where appropriate, Independent Life submits formal objections, expert testimony, or affidavits.
· Transparency Reporting: The company discloses annual objection statistics as a model of corporate accountability.
· Stakeholder Re-Engagement: Consultants are encouraged to reengage with their clients to provide guidance and support.
This is not just an Independent Life corporate policy—it is a call to raise the ethical bar industry-wide.
Restoring Integrity Through Industry Leadership
The structured settlement market has added safeguards against factoring abuse since the 1990s, with IRC §5891 and state SSPAs providing valuable legal guardrails. But the record $9.5 billion in 2024 sales also signals growing complexity, scale, and responsibility.
White and Cordero illustrate that legislative safeguards are not enough. One case reveals how procedural compliance can mask profit-seeking exploitation; the other, how insurer disengagement can result in repeated abuse. In both instances, the system failed those it was designed to protect.
Improving the current system must start within the industry itself. Enhanced judicial scrutiny, stricter standards for repeat transactions, elimination of forum shopping, and protections for cognitively impaired individuals are all essential. Leadership, however, must begin with the companies that actually issue the structured settlement annuities.
Independent Life’s PPP offers a replicable model of ethical engagement by structured settlement annuity providers—one that neither exploits nor ignores but supports and informs. Structured settlements were built on the promise of long-term security. The industry must recommit to that mission, not just in theory, but in action.
