The Settlement Alliance

What Should You Expect From a Qualified Settlement Fund Administrator?

What Should You Expect From a Qualified Settlement Fund Administrator?

Jun 8, 2015

Once a settlement is reached, it is important that each claimant has the time to make well-informed decisions about how to handle their portion of the recovery. In order for that to occur, neither the plaintiff law firm(s) nor the claimant(s) can have constructive receipt of the settlement funds. For mass torts involving hundreds, or even thousands of claimants, that’s where a Qualified Settlement Fund (“QSF”; sometimes referred to as a 468B Trust) comes in.

A QSF allows claimants the most valuable thing they could ask for after their case is settled—time. The defendant pays the money to the QSF, releasing the defendant of liability. This process protects against any future insolvency of the defendant, getting the money into a fund, account, or trust for safekeeping. The QSF allows time to determine settlement amounts, resolve outstanding liens, and educate plaintiffs on their different settlement options.

What is the most important decision for the law firm once the settlement is reached? The choice of QSF Administrator. An experienced QSF Administrator can make a significant difference in terms of how smoothly the settlement is handled.

Qualified Settlement Fund Administrator Responsibilities

While some may assume that a QSF is just a bank account in which to hold the settlement recovery, the administration of the account is much more complicated and time-intensive than they may realize. The Fund Administrator handles all aspects of the QSF and as such, should demonstrate a comprehensive understanding of post-settlement issues. Some market themselves as “QSF Administrators,” but in reality, have little experience outside of brokering structured settlements.

Responsibilities include, but are not limited to:

  • Preparing all motions, court orders, and documents needed to establish and administer the fund
  • Disbursement of all claimant payments, including direct funding of Special Needs Trusts and/or structured settlements
  • Attorney fee and expense disbursement
  • Executing qualified assignments
  • Managing payment of finalized liens
  • Managing bankruptcy verification & clearance
  • Coordinating probate administration
  • Fraud protection/check validity verification
  • Daily account reconciliation, monthly financial accounting and reporting
  • Treasury management and investing funds within the QSF
  • Completing tax return filings and quarterly QSF reporting, including 1099 issuance
  • Handling the eventual closing of the fund

The Settlement Alliance believes the QSF Administrator should take the level of service a step further. We are currently administering 50+ qualified settlement funds for over 70,000 claimants, totaling over $3 billion in settlement proceeds. As a QSF Administrator, we have a dedicated government benefits team available to answer any questions that claimants may have about the impact of the settlement on their entitlement and/or needs-based benefits. TSA also provides printed educational materials on government benefits, structured settlements, bankruptcy, and probate issues. Our access to local elder law, bankruptcy, and probate attorneys across the country provides claimants with local experts they can trust.

The job of the QSF Administrator is much more than just operating a bank account. It’s a time-consuming process that requires professional assistance from someone who has extensive experience as a court-appointed Qualified Settlement Fund Administrator. Before selecting a QSF Administrator for your next mass tort, make sure you do your research.

We are proud to partner with the highest rated structured settlement providers in the industry:

  • American general Life Companies
  • Berkshire Hathaway Structured Settlements
  • MetLife
  • Mutual of Omaha
  • New York Life
  • Pacific Life
  • Prudential