Life-contingent structured settlement payments
Life-Contingent Structured Settlement Payment Rights
Structured settlement payment rights that pay a slightly higher estimated yield, hedged with a life insurance policy on the original payee. If the payee passes before the schedule completes, the stream ends and the policy pays a lump sum structured to preserve your estimated yield for the time you held it — the hedge protects the yield, not the total of the scheduled payments.
Yields on placed inventory have historically run 4–7%. These are long-term holdings with limited liquidity and are not FDIC-insured or securities.
Life-Contingent, explained
What life-contingent structured settlement payment rights are
The right to receive structured settlement payments that continue only while the original payee is living, hedged with a life insurance policy. If the payee passes before the schedule completes, the policy pays a lump sum structured to preserve the investor's estimated yield for the time held.
A life-contingent stream is the right to receive structured settlement payments that are payable only while the original payee is alive on each payment date. Like every deal, the transfer is reviewed and approved by a court, and the payments are funded by a top-rated carrier. It is a payment right, not an annuity or an insurance product.
Each deal is priced using a rated age, a medically informed life-expectancy estimate for the payee, which drives both the yield and the weighted average life. What sets the streams we place apart is that they are hedged with a life insurance policy: if the payee dies before the schedule completes, a death benefit is paid to the investor to cover the shortfall.
Why the estimated yields run higher
Life-contingent streams carry the highest estimated yields in this market because payment continuation depends on the payee's life. The life-insurance hedge we place on our inventory is designed to offset that mortality risk, so a death benefit is paid to the investor if the payee passes early.
That risk premium sits on top of the usual secondary-market discount: no retail sales load, a secondary-market entry price, and a seller who already took a discount for cash. The result is estimated income potential above a guaranteed stream of similar duration.
Who it suits
- Yield-focused investors who want the highest available rates with a mortality hedge in place
- Buyers diversifying across several deals to further spread single-life exposure
- Investors seeking returns above guaranteed streams and comfortable with an uncertain end date
- Longer-horizon accounts that can hold a long-term position with limited liquidity in exchange for the higher estimated yield
Risks to weigh
- Mortality is the defining variable: payments cease if the payee dies before the schedule ends. The life-insurance hedge on our inventory is designed to pay a death benefit in that event, but you should confirm the hedge terms on each specific deal.
- The rated age is an estimate, not a certainty, and actual longevity varies.
- Like all of these assets, the streams are long-term holdings with limited liquidity (resale may be possible with our assistance but is not guaranteed), not FDIC-insured, not securities, and not guaranty-association protected.
- Spreading capital across multiple streams is the common way to further manage single-life exposure.
Available now
Current life-contingent options
A sample of what is available now. Browse the full inventory to view payment schedules, documents, and available pricing on every option.
Nothing available in this category right now
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Common questions
Life-Contingent FAQ
What is a life-contingent structured settlement payment right?
What happens if the payee dies early?
Why do these yield more than guaranteed streams?
Pacific Structured Assets, Inc. does not provide tax, legal, financial or accounting advice. The material on this website has been prepared for informational purposes only and is not intended to provide, and should not be relied on for, tax, legal, financial or accounting advice. You should consult your own tax, legal, financial or accounting advisors before engaging in any transaction, including the acquisition of factored structured settlement payments. Pacific Structured Assets is not registered with the Securities and Exchange Commission and is not licensed to sell insurance in any state.
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