Soldiers vs. Scouts: The NSSTA 2021 Annual Conference

In her new book titled “The Scout Mindset”, author Julia Galef, co-founder of the Center for Applied Rationality, utilizes a comparative military metaphor, “soldiers vs. scouts,” to contrast two antithetical types of mindsets and methods of reasoning.

Metaphorically speaking:

  • soldier mindset causes an individual or a group to defend their beliefs against perceived threats, to seek out supporting evidence, to ignore or resist alternative evidence and to refuse to admit when they are wrong. Soldiers, according to Galef, engage in “directional motivated reasoning” evaluating new ideas by asking “can I believe this” or “must I believe this” with the answer depending on their motives. Galef compares directional motivated reasoning to a soldier fighting off threatening evidence.
  • In contrast, a scout mindset attempts to “see things as they are” by seeking out the truth through evidence that will provide a more accurate map of reality. With a scout mindset, there is no such thing as a “threat” to beliefs. This means an individual or group is always open to changing their mind in response to new information or new ideas. Galef views scouts as engaging in “accuracy-based reasoning.” Unlike soldiers, scouts evaluate a new idea by asking “is it true?” Being in a scout mindset means wanting your “map” (i.e. your perception of yourself and your world) to be as accurate as possible.

NSSTA 2021 Annual Conference

When the National Structured Settlement Trade Association (NSSTA) hosts its virtual 2021 Annual Conference May 4-7, NSSTA members might utilize Galef’s “soldier vs. scout” metaphor for the association’s collective advantage: first, as a litmus test for evaluating NSSTA’s mindset about its own current status within the settlement industry; and second, and more importantly, for determining how NSSTA looks toward the future.

This recommendation seems especially applicable to Session 1 of the NSSTA Conference titled “Structured Settlement Industry Stakeholder Discussion: The Current Status and Future Expectations for the Settlement Industry” – undoubtedly the most strategic session of conference.

Moderated by NSSTA President Michael Goodman and Executive President Eric Vaughn, Session 1 will feature five panels consisting of the following stakeholder representatives: 1) annuity providers, including Independent Life CEO Jimmy Atkins; 2) workers compensation professional administrators; 3) “complimentary” product providers; 4) trust providers; and 5) consultants – 25 panelists in total speaking for 1 hour and 40 minutes.

Which settlement ideas will these diverse panelists identify as vital to the current and future role of structured settlements within the settlement industry more generally? Which important ideas will they overlook or ignore? Will the panelists attempt to defend their beliefs against perceived threats? Or will they be open-minded to new information and new ideas from sources outside of NSSTA?

Settlement Ideas

Let’s consider some examples of settlement ideas currently being addressed in other industry venues and forums and suggest possible “scout” perspectives – to encourage NSSTA Session 1 panelists to do likewise as they address these and other settlement ideas and developments.

Fixed and Determinable

One of the statutory requirements of IRC Section 130 is that “periodic payments must be fixed and determinable as to amount and time of payment.” (emphasis added) Instead of narrowly defining “structured settlements” as “single premium fixed annuities” and characterizing other products as “complimentary,” a scout might explore the meaning and boundaries of “fixed and determinable,” encourage new products and analyze “structured settlements” in depth in terms of both process and integrated settlement plans.

Fiduciary Duty

In his February 13, 2006 Opinion Letter written to the Academy of Catastrophic Injury Lawyers titled “Use of Structured Settlement Experts by Plaintiff Counsel”, Professor Stephen A. Saltzburg wrote: “… the [structured settlement] expert retained by the plaintiff’s counsel to represent the interests of the client owes a fiduciary duty to the client.” (emphasis added) In addition to asking “is it true?”, a scout might also ask “what is a fiduciary duty and how does it impact structured settlement advisors?

Best Interest

A fiduciary duty generally incorporates a “best interest” standard of conduct which could apply, among other applications, to product recommendations. A scout might ask: “what does “best interest” mean when applied to structured settlement annuity recommendations? What would constitute a set of structured settlement “best interest” best practices? What sources would be relevant? For examples: would any of the NAIC Model Regulation #275 (Suitability in Annuity in Annuity Transactions) “best interest” requirements be useful? What about the SSP Settlement Planning Practice Standards?”

Secondary Market Strategy

In his 2020 law review article titled Enforcing and Reforming Structured Settlement Protection Acts: How the Law Should Protect Tort Victims, James Gordon argues that: the entire state legislative scheme to approve transfer petitions “has fundamental substantive and procedural flaws that prevent it from achieving its purpose.

Gordon also maintains that annuity providers violate their contractual obligation of good faith to a personal injury victim payee when they accept an administrative fee from a factoring company to waive an anti-assignment clause.

As an alternative, Gordon recommends that annuity providers should establish “transfer objection policies” citing, as one example, Independent Life’s Payee Protection Policy . A scout might not only ask “is it true” but also whether Gordon’s arguments provide a sensible alternative strategy for NSSTA to discuss and consider.


Every structured settlement stakeholder owes a debt of gratitude to NSSTA. Since it was founded 35 years ago, NSSTA has “protected and preserved” IRC Sections 130 and 104 (a)(1) and (2) thereby creating a “strategic position” for structured settlement annuities within the settlement industry.

For the past 21 years, NSSTA has further “protected” structured settlement recipients and “defended” the structured settlement community against abuses of factoring companies through the enactment of IRC Section 5891 and 49 state structured settlement protection acts.

Arguably, a significant part of these important industry accomplishments have required a soldier mindset – a continuous focus on a specific set of defensive objectives.

Despite these accomplishments, however, the structured settlement primary market has plateaued and NSSTA has lost members. The NSSTA 2021 Annual Conference, in general, and Session 1, more specifically, offer NSSTA a timely opportunity to re-set its strategic priorities and re-gain primary market momentum. To do so, a “scout mindset” seems not only helpful but necessary.

NSSTA, therefore, cannot afford to be threatened by new settlement ideas. Instead, NSSTA and its members should always “see things as they are,” and promote “accuracy-based reasoning” as an association core competency – which, in turn, will inevitably lead to structured settlement improvement, innovation and growth.