Colonial pays cash for structured settlements!
Florida statues
regarding Structured Settlements.
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This state statute overseeing the
sale of structured settlement payments and
the buying of annuities is not exactly the
Model Act but complies with Federal Law
with the addition of front end disclosure.
(Colonial's interpretation)
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WEST'S FLORIDA STATUTES ANNOTATED
TITLE XXXVII. INSURANCE
CHAPTER 626. INSURANCE FIELD REPRESENTATIVES AND
OPERATIONS
PART XI STRUCTURED SETTLEMENTS
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(3) Conditions to transfers of structured settlement
payment rights and structured settlement
agreements.--
(a) A direct or indirect transfer of structured settlement
payment rights is not effective and a structured
settlement obligor or annuity issuer is not required
to make a payment directly or indirectly to a transferee
of structured settlement payment rights unless the transfer
is authorized in advance in a final order by a
court of competent jurisdiction which is based on the
written express findings by the court that:
1. The transfer complies with this section and does
not contravene other applicable law;
2. At least 10 days before the date on which the payee
first incurred an obligation with respect to the
transfer, the transferee provided to the payee a disclosure
statement in bold type, no smaller than 14 points
in size, which specifies:
a. The amounts and due dates of the structured settlement
payments to be transferred;
b. The aggregate amount of the payments;
c. The discounted present value of the payments, together
with the discount rate used in determining the
discounted present value;
d. The gross amount payable to the payee in exchange
for the payments;
e. An itemized listing of all brokers' commissions,
service charges, application fees, processing fees,
closing costs, filing fees, referral fees, administrative
fees, legal fees, and notary fees and other
commissions, fees, costs, expenses, and charges payable
by the payee or deductible from the gross amount
otherwise payable to the payee;
f. The net amount payable to the payee after deducting
all commissions, fees, costs, expenses, and charges
described in sub-subparagraph e.;
g. The quotient, expressed as a percentage, obtained
by dividing the net payment amount by the discounted
present value of the payments, which must be disclosed
in the following statement: "The net amount that
you will receive from us in exchange for your future
structured settlement payments represent ___
percent of the estimated current value of the payments
based upon the discounted value using the
applicable federal rate";
h. The effective annual interest rate, which must be
disclosed in the following statement: "Based on the
net amount that you will receive from us and the amounts
and timing of the structured settlement
payments that you are turning over to us, you will,
in effect, be paying interest to us at a rate of ___
percent
per year"; and
i. The amount of any penalty and the aggregate amount
of any liquidated damages, including penalties,
payable by the payee in the event of a breach of the
transfer agreement by the payee;
3. The payee has established that the transfer is in
the best interests of the payee, taking into account
the
welfare and support of the payee's dependents;
4. The payee has received, or waived his or her right
to receive, independent professional advice regarding
the legal, tax, and financial implications of the transfer;
5. The transferee has given written notice of the transferee's
name, address, and taxpayer identification
number to the annuity issuer and the structured settlement
obligor and has filed a copy of the notice with
the court;
6. The transfer agreement provides that if the payee
is domiciled in this state, any disputes between the
parties will be governed in accordance with the laws
of this state and that the domicile state of the payee
is
the proper venue to bring any cause of action arising
out of a breach of the agreement; and
7. The court has determined that the net amount payable
to the payee is fair, just, and reasonable under the
circumstances then existing.
(b) If a proposed transfer would contravene the terms
of the structured settlement, upon the filing of a
written objection by any interested party and after
considering the objection and any response to it, the
court may grant, deny, or impose conditions upon the
proposed transfer which the court deems just and
proper given the facts and circumstances and in accordance
with established principles of law. Any order
approving a transfer must require that the transferee
indemnify the annuity issuer and the structured
settlement obligor for any liability, including reasonable
costs and attorney's fees, which arises from
compliance by the issuer or obligor with the order of
the court.
(c) Any provision in a transfer agreement which gives
a transferee power to confess judgment against a
payee is unenforceable to the extent that the amount
of the judgment would exceed the amount paid by the
transferee to the payee, less any payments received
from the structured settlement obligor or payee.
(d) In negotiating a structured settlement of claims
brought by or on behalf of a claimant who is
domiciled in this state, the structured settlement obligor
must disclose in writing to the claimant or the
claimant's legal representative all of the following
information that is not otherwise specified in the
structured settlement agreement:
1. The amounts and due dates of the periodic payments
to be made under the structured settlement
agreement. In the case of payments that will be subject
to periodic percentage increases, the amounts of
future payments may be disclosed by identifying the
base payment amount, the amount and timing of
scheduled increases, and the manner in which increases
will be compounded;
2. The amount of the premium payable to the annuity
issuer;
3. The discounted present value of all periodic payments
that are not life- contingent, together with the
discount rate used in determining the discounted present
value;
4. The nature and amount of any costs that may be deducted
from any of the periodic payments;
5. Where applicable, that any transfer of the periodic
payments is prohibited by the terms of the
structured settlement and may otherwise be prohibited
or restricted under applicable law; and
6. That any transfer of the periodic payments by the
claimant may subject the claimant to serious adverse
tax consequences.
(4) Jurisdiction; procedure for approval of transfers.--At
least 20 days before the scheduled hearing on
an application for authorizing a transfer of structured
settlement payment rights under this section, the
transferee must file with the court and all interested
parties a notice of the proposed transfer and the
application for its authorization. The notice must include:
(a) A copy of the transferee's application to the court;
(b) A copy of the transfer agreement;
(c) A copy of the disclosure statement required under
subsection (3);
(d) Notification that an interested party may support,
oppose, or otherwise respond to the transferee's
application, in person or by counsel, by submitting
written comments to the court or by participating in
the
hearing; and
(e) Notification of the time and place of the hearing
and notification of the manner in which and the time
by which any written response to the application must
be filed in order to be considered by the court. A
written response to an application must be filed within
15 days after service of the transferee's notice.
(5) Waiver prohibited; no penalties incurred.--
(a) The provisions of this section may not be waived.
(b) If a transfer of structured settlement payment
rights fails to satisfy the conditions of subsection
(3),
the payee who proposed the transfer does not incur any
penalty, forfeit any application fee or other
payment, or otherwise incur any liability to the proposed
transferee.
(6) Noncompliance.--
(a) If a transferee violates the requirements for stipulating
the discount and finance charge provided for in
subsection (3), neither the transferee nor any assignee
may collect from the transferred payments, or from
the payee, any amount in excess of the net advance amount,
and the payee may recover from the transferee
or any assignee:
1. A refund of any excess amounts previously received
by the transferee or any assignee;
2. A penalty in an amount determined by the court,
but not in excess of three times the aggregate amount
of the discount and finance charge; and
3. Reasonable costs and attorney's fees.
(b) If the transferee violates the disclosure requirements
in subsection (3), the transferee and any assignee
are liable to the payee for:
1. A penalty in an amount determined by the court,
but not in excess of three times the amount of the
discount and finance charge; and
2. Reasonable costs and attorney's fees.
(c) A transferee or assignee is not liable for any
penalty in any action brought under this section if
the
transferee or assignee establishes by a preponderance
of evidence that the violation was not intentional and
resulted from a bona fide error, notwithstanding the
transferee's maintenance of procedures reasonably
designed to avoid such errors.
(d) Notwithstanding any other law, an action may not
be brought under this section more than 1 year after
the due date of:
1. The last transferred structured settlement payment,
in the case of a violation of the requirements for
stipulating the discount and finance charge provided
for in subsection (3).
2. The first transferred structured settlement payment,
in the case of a violation of the disclosure
requirements of subsection (3).
(e) When any interested party has reason to believe
that any transferee has violated this section, any
interested party may bring a civil action for injunctive
relief, penalties, and any other relief that is
appropriate to secure compliance with this section.
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