Colonial pays cash for structured settlements!

Kentucky statues regarding Structured Settlements.

This state statute overseeing the sale of structured settlement payments and the buying of annuities is not the Model Act but complies with Federal Law . The "imminent financial harm" finding makes it unworkable. (Colonial's interpretation)

BALDWIN'S KENTUCKY REVISED STATUTES ANNOTATED
TITLE XLII. MISCELLANEOUS PRACTICE PROVISIONS
CHAPTER 454. MISCELLANEOUS CIVIL PRACTICE PROVISIONS
TRANSFER OF STRUCTURED SETTLEMENT PAYMENT RIGHTS


Current through End of 2002 Reg. Sess.


454.430 DEFINITIONS FOR KRS 454.430 TO 454.435

As used in KRS 454.430 to 454.435:

(1) "Annuity issuer" means an insurer that has issued an annuity contract to be used to fund
periodic payments under a structured settlement;

(2) "Payee" means an individual who is receiving tax-free damage payments under a structured
settlement and who wants to make a transfer of payment rights under the structured settlement
agreement;

(3) "Protected parties" means, with respect to any structured settlement, the payee, any named
beneficiary designated in the annuity contract or structured settlement to receive payments
following the payee's death, or, if the named beneficiary is a minor, the named beneficiary's
parent or guardian, the annuity issuer, and the structured settlement obligor;

(4) "Qualified assignment agreement" means an agreement providing for a qualified assignment
that meets the requirements of Section 130 of the Internal Revenue Code, 26 U.S.C. sec. 130, as
amended from time to time;

(5) "Settled claim" means the original tort claim resolved by a structured settlement;

(6) "Structured settlement" means an arrangement for periodic payment of damages for personal
injuries established by settlement or judgment in resolution of a tort claim;

(7) "Structured settlement obligor" means, with respect to any structured settlement, the party
that has the continuing periodic payment obligation to the payee under a structured settlement
agreement or a qualified assignment agreement;

(8) "Structured settlement payment rights" means rights to receive periodic payments, including
lump sum payments under a structured settlement, whether from the settlement obligor or the
annuity issuer, where:

     (a) The payee or any other protected party is domiciled in this state; or

     (b) The settled claim was pending before the courts of this state when the structured settlement
was reached;

(9) "Transfer" means any sale, assignment, pledge, hypothecation, or other form of alienation or
encumbrance made for consideration; and

(10) "Transfer agreement" means the agreement providing for transfer of structured settlement
payment rights from a payee to a transferee.


 

454.431 REQUIREMENT FOR COURT APPROVAL OF TRANSFER OF STRUCTURED
SETTLEMENT PAYMENT RIGHTS; EXPRESS FINDINGS THAT ARE REQUIRED

No transfer of structured settlement payment rights shall be effective and no structured
settlement obligor or annuity issuer shall be required to make any payment directly or indirectly
to any transferee of any transfer of structured settlement payment rights unless the transfer has
been approved in advance in an order of a court of competent jurisdiction, based on the court's
express findings that:

(1) The transfer complies with the requirements of KRS 454.430 to 454.435 and does not
contravene other applicable law;

(2) Not less than ten (10) days prior to the date on which the payee entered into the transfer
agreement, the transferee has provided to the payee a disclosure statement in bold type, no
smaller than fourteen (14) point, setting forth:

     (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 or rates 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 or processing
      fees, closing costs, filing or administrative charges, legal fees, 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; and

     (f) The amount of any penalty and the aggregate amount of any liquidated damages, including
     penalties, payable by the payee in the event of any breach of the transfer agreement by the payee;

(3) The payee has established that the transfer is necessary to enable the payee to avoid imminent
financial hardship;

(4) 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 had filed a
copy of the notice with the court; and

(5) The payee has consented in writing to the transfer.

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