Relative to structured settlement payment protections
Impact
This legislation aims to impose stricter requirements on the transfer of structured settlement payments by necessitating court approval for such transactions. Specifically, it mandates that a court must determine whether a transfer is in the best interests of the payee, taking into account their welfare and any dependents they may have. By requiring independent professional advice for minors and protected persons, the bill tries to mitigate the risk of exploitation and ensure that such vulnerable individuals make informed decisions regarding their structured settlements.
Summary
House Bill 1863, titled 'An Act relative to structured settlement payment protections,' seeks to enhance the existing framework around structured settlement transfers, emphasizing the protection of vulnerable individuals such as minors and those with mental or cognitive impairments. The bill revises definitions within Chapter 231C of the General Laws, particularly clarifying terms such as 'independent professional advice' and introducing new categories for 'minors' and 'protected persons.' This aims to ensure that these individuals receive adequate legal and financial guidance before any transfer of their structured settlement payment rights can occur.
Contention
Potential points of contention surrounding HB 1863 include discussions about the balance between consumer protection and the fluidity of financial transactions involving structured settlements. Proponents argue that the stringent requirements for court approvals and independent advice are necessary to protect at-risk individuals from predatory practices. Conversely, critics may contend that these requirements could complicate or delay legitimate transfers, thereby hindering access to funds that individuals may urgently need. The efficacy of the regulatory measures introduced by the bill will likely be scrutinized in terms of enforcement and their impact on structured settlement purchase companies.
Provides for exclusion from guaranty fund coverage for a person acquiring rights to receive payments through a "structured settlement factoring transaction"