Secondary Annuities

A Secondary Market Annuity (also called an 'SMA') refers to a transaction in which the current owner of an income annuity sells his future income steam to a third-party in exchange for a lump-sum payment. Annuity income streams most commonly originate from lawsuit settlements, lottery winnings, or immediate annuities.

The majority of secondary market annuity transactions involve structured settlement payments that were awarded for damages or as a result of personal injury. It is not uncommon, at some point in the payment process, for settlement recipients to come to the decision that they do not want to wait for years to receive their entire payouts. Selling their future payment stream into the secondary market is one of the only options available to receive a lump sum in advance of their defined payment schedule.

Investors can purchase these secondary market annuities from the original owner, usually with the involvement of some type of intermediary, and have the future stream of payments assigned to them. The yields available with secondary market annuities are typically slightly higher than can be obtained when purchasing a primary market fixed annuity.

Secondary Annuities Current Inventory