I am often asked about the safety of the annuity payments we use for structured settlements, particularly by those who need those payments over their lifetime. Judges are also interested in annuity safety especially before approving a Minor’s Compromise. Judges want to be confident that the insurance carrier issuing the annuity has the financial strength to provide scheduled payments over the life of a structured settlement—no matter how long that may be.
MetLife has offered a window into how it manages its annuity portfolio in a recently released report:
The report provides a quick look at where MetLife invests its assets. Over 65 percent of its assets are allocated to bonds (of which nearly 90 percent are investment grade), followed by mortgage loans, other assets, corporate equity, cash and short-term investments and real estate. The report also discusses MetLife’s investment strategies designed to reduce risk while increasing cash flow.
These kinds of documents from highly rated insurance carriers can be used to help reassure clients of the safety of the annuity and its underlying assets–assets that produce the income streams that are so critical to injured parties and their peace of mind.