First Read: January 2010
by J.T. Long
Rick Bishop is a resolution rebel, and a successful one at that.
His structured settlement firm was named among the fastest-growing private companies in America in Inc. Magazine’s 2009 rankings, but a shaky economy has left him wondering if his forward strides can be sustained through 2010 and 2011.
Based in Elk Grove, Settlement Professionals Inc. operates 25 offices in 14 states, including regional work spaces in Roseville and Sacramento. SPI grew by 252.8 percent between 2005 and 2008, according to Inc., a window when revenues from the establishment of trusts equaled $2.3 million, and revenue increased to $8.2 million.
Bishop credits his success to a countercultural approach to the structured-settlement industry. Since the Internal Revenue Service tax code changed in 1982, plaintiffs in personal-injury and wrongful-death cases have been allowed to receive periodic payments of their settlement and profit from the investment of that money tax-free. As such, defendant attorneys have hired insurance professionals to purchase annuities and set up structured settlements that pay out over several years.
Peter Arnold, a consultant to the Washington-based National Structured Settlements Trade Association, says the industry has not grown during the past few years, issuing about $6 billion in life insurance annuities annually for future structured payments.
About 700 consultants work in companies consisting of one or two insurance investors to hundreds of settlement specialists run by one structured-settlement company