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HB 0443 - Torts; transfer of structured settlement payment rights; provide new requirements

Tracking Level: Monitor
Sponsor: Rob Leverett
Last Action: 5/10/2021 - Effective Date 2021-07-01
House Committee: Judiciary
Senate Committee: Judiciary
Assigned To:
12. All CourtsNext Bill
TortNext Bill

Staff Analysis of the Legislation

HB 443 creates the 'Georgia Structured Settlement Protection Act' to provide new requirements regarding the transfer of structured settlement payment rights. The bill defines key terms for the process of transferring structured settlements, and establishes registration and application requirements for “transferees”, who are defined as people acquiring or proposing to acquire structured settlement payment rights through a transfer. HB 443 provides that a person or entity shall not act as a transferee, attempt to acquire structured settlement payment rights from a Georgia resident, or file a structured settlement transfer proceeding in the state unless the person or entity has registered with the Secretary of State to do business in Georgia. Registration must be renewed annually and include a sworn certification demonstrating that the applicant has secured a surety bond, has been issued a letter of credit, or has posted a $50,000 cash bond. The bond, letter of credit, or cash bond shall be effective concurrently with an applicant's registration with the Secretary of State and shall remain in effect for not less than three years after expiration or termination of that registration. It shall additionally be renewed each year when the registration of the applicant is renewed. The Secretary of State is authorized to set and charge a fee to offset the costs of processing and maintaining the required registration. Additionally, the liability of the surety under the bond is not affected by any breach of contract, breach of warranty, failure to pay a premium, or any insolvency or bankruptcy of the structured settlement purchase company. HB 443 outlines certain actions that transferees or structured settlement purchase companies are prohibited from engaging in, and provides for a cause of action for the violation of such prohibitions.  

At least ten days before the holder of a structured settlement signs a transfer agreement that transfers his or her interest in such settlement to a transferee, the transferee must provide such holder with certain disclosures outlined within the bill. No transfer of structured settlement payment rights shall be effective unless the transfer has been approved in advance in a final court order based on certain express findings by the court that the transfer is in the best interest of the payee, the payee was advised in writing to seek professional advice, and the transfer does not contravene any statute or the court order of any governing authority. Notice of a transferee's application for the approval of such transfer must be provided at least 20 days prior to any scheduled hearing on the application. HB 443 outlines the requirements for such notice and application.  

The provisions of the bill may not be waived by a payee. All transfer agreements entered into by a payee in Georgia must provide that disputes under such transfer agreement shall be determined by Georgia law. Transfer and structured settlement rights under a structured settlement shall not extend to payments that are life contingent unless the transferee establishes and agrees to maintain procedures that periodically confirm the payee's survival and give an annuity insurer and the structured settlement obligor prompt notice of the payee's death. The bill shall not be construed to imply that any transfer agreement entered into prior to the Act's effective date is valid or invalid, or affect the validity of any transfer of structured settlement payment rights, whether under a transfer agreement entered into prior to or subsequent to the bill's effective date, in which the obligor and annuity issuer have waived, or have not asserted their rights under, terms of the structured settlement prohibiting or restricting sale, assignment, or encumbrance of the structured settlement payment rights. 

Bill Summary from the State Site - Click for the State Summary Page / Click for Current Full Text