Industry Education, Financial Products and Concepts

Industry Education, Financial Products and Concepts

Should the National Structured Settlement Trade Association (NSSTA), and its members, be interested in education programs about financial planning products and concepts other than structured settlement annuities – and, if so, why?

Addressing this question is part of a series of articles evaluating whether NSSTA needs to re-think and re-design its educational programming and educational marketing to strategically position structured settlement annuities as the core product within personal injury settlement planning.

It is also important to point out that Independent Life itself is the first annuity provider to focus exclusively on the structured settlement market to help personal injury victims and their families. We don’t sell any products other than structured settlement annuities and we believe structured settlement annuities should be considered a core product for every personal injury settlement plan.

Many personal injury settlement plans, however, include a mix of public benefits and financial products, in addition to structured settlement annuities. And, historically, NSSTA’s educational programs typically have not addressed financial products and concepts other than those directly or indirectly related to structured settlement annuities.

2019 Education Programs

For example, during 2019, NSSTA’s regular educational programs (its Annual and Fall Conferences) offered two presentations about products: 1) a repeat discussion about the perils of “Recycled Annuities”; and a panel addressing “Non-Qualified Assignments”.

NSSTA’s 2019 CSSC Program likewise offered two product sessions. Notre Dame Professor Frank Reilly spoke about “Fixed Income Investments” which typically comprise the investment portfolios of life companies to support their structured settlement annuity obligations. Christi Fried also presented on “Structured Settlement Trusts”.

The 2019 Society of Settlement Planners (SSP) featured product presentations by association members and sponsors including a “Structures” update by Serena Fitchard plus an “Independent Life” introduction by Jimmy Atkins.

Why would NSSTA members, especially NSSTA brokers, need or want education about non-structured settlement annuity financial planning products and concepts?

NSSTA Code of Ethics

Principle ll (Competence) of NSSTA’s “Statement of Ethics and Professional Responsibility” (Code of Ethics) states in part: “All NSSTA members are expected to attain and maintain an understanding of relevant …. financial planning concepts.”

What financial planning “concepts” might this provision encompass? NSSTA’s Code of Ethics does not identify specific financial planning concepts per se. However, other Principles within the NSSTA Code of Ethics set forth numerous ethical values that might otherwise be categorized as “best interest”, various types of “disclosure” (including but not limited to “conflicts of interest”) and perhaps even product “suitability” – which merit greater educational consideration.

Modern Portfolio Theory and the UPIA

Modern portfolio theory” is another financial planning concept NSSTA might consider incorporating into its education curriculum. Forty-four states and the District of Columbia have adopted the Uniform Prudent Investor Act (UPIA) which incorporates “modern portfolio theory” as an investment standard for trustees.

Section 2(c) of the UPIA identifies eight factors a trustee should consider when making any investment. When settlement trusts play a role in a personal injury settlement, structured settlement and settlement planning professionals should be prepared to address all eight factors as part of their sales strategy.

Significant for structured settlement annuities, the UPIA’s list of investment considerations fails to mention the mental or physical disabilities of a trust beneficiary. From a settlement planning perspective, injuries or diseases that create special needs or reduce an individual’s normal life expectancy arguably should receive important consideration when a trustee makes investment decisions.

Non-Structured Settlement Financial Planning Products

Should NSSTA’s member education expand even further – beyond financial planning concepts to introduce NSSTA members to non-structured settlement financial planning products?

Traditionalists undoubtedly will argue “absolutely not”! Why patronize the competition?

An alternative perspective might be that NSSTA has an obligation to help its members better compete in the transitional personal injury settlement planning marketplace. Within this marketplace, an increasing number of professionals sell multiple investment products and compete to be the primary financial/insurance advisors for specific plaintiffs and their attorneys.

Structured settlement consultants (increasingly marketing themselves as “settlement planners”) therefore must compete with Certified Financial Planners (CFPs), investment advisors, bankers, settlement trustees, and others for this primary advisor role – or at least to be part of the settlement planning team.

A comprehensive financial planning knowledge (concepts and products) arguably would not only improve the professional credibility of structured settlement consultants. Such knowledge would also help structured settlement consultants explain (and compare) the unique benefits of our product for injury victims and their families and, also, how best to integrate periodic payments with other investments as part of a comprehensive settlement plan.


In her inaugural address last Spring, NSSTA President Michelle Caine highlighted “raising the awareness and educating on the benefits of structured settlements [as] a key component of [NSSTA’s] mission and [as] critical to our future success.” Independent Life fully supports Michelle Caine’s focus on education to advance the growth of the structured settlement market.

Complementary to this external educational marketing initiative, however, is the question of what education NSSTA members themselves need to successfully increase structured settlement annuity sales in a transitional personal injury settlement planning market. Consistent with NSSTA’s own Code of Ethics, greater knowledge of financial planning concepts (and, also, financial planning products) might enable NSSTA members to better advise our clients and market our own products more successfully.