Transfers of Structured Settlement
Block 17.6 Article 2.3 Transfers of Structured Settlement Payment Rights
Can an Antiassignment Provision Prevent a Transfer of Structured Settlement Payment Rights?
It depends if the antiassignment provision is statutory/court order, or contractual. If the antiassignment provision is statutory or a court order then no transfer can happen.
If the insurance company wrote the antiassignment provision in the settlement documents prohibiting the payee from receiving future settlement payments, it is up to the insurance company to enforce the antiassignment provision. Insurance companies typically waive this contravention.
There are instances where it is not waived, for example, in 2005 Connecticut Superior Court, an insurance company was notified of a transfer per typical protocol, and they simply disapproved the application for transfer based on their contractual antiassignment provision.
In 2005, Tennessee Circuit Court, the same thing happened. And in 2002, both Indiana Circuit Court and Ohio Probate Court the same thing happened: transfer application denied because of insurance companies contractual antiassignment provision in the settlement documents.
New York had a case where the court approved the transfer over the insurer’s objection: finding that antiassignment provision did not nullify the transfer; “the court is arguably empowered to override an antiassignment clause.”
Isn’t that interesting?
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