What Seniors Should Understand About Annuity Fees
Fees Versus “Guarantees”
How Carriers Protect Themselves
Deferred annuities generally carry a variety of fees from initial sales commissions to producing agents, administrative fees, subaccount fees, and fees for enhanced contract features known as “riders.” Seniors consumers need to understand how fees operate in deferred annuities and may reduce promised returns. The San Francisco financial elder abuse attorneys at Evans Law Firm, Inc. represent senior consumers who lose money on deferred annuities due to fees, undisclosed or misleading information, withdrawal charges, botched replacement transactions, and tax bills. If you or someone you know is over 60 and lives in San Francisco or elsewhere in California and has lost money on an indexed annuity, call us today at 415-441-8669 or toll free at 888-50EVANS (888-503-8267).
Deferred annuities generally have several types of ongoing fees. The first relate to the underlying funds expenses that would be included with any mutual fund investment. The subaccounts may have additional fees in their expense ratios. The second type of fee relates to mortality and expense charges for the insurance company. These fees help to support the mortality risk of lifetime income benefits and death benefits (often either the return of contract value or premiums paid). The mortality and expense fee also is applied to the costs of business and to support profit levels for the carrier.
In addition to these standard annual fees, enhanced benefits known as riders also impose annual fees. For example, income riders, sold as “guarantees” of lifetime income benefits carry fees normally at around 1% annually. To continue with that example, if the rate of return on the annuity is 2% an income rider would cut the return on the premiums paid in half. Moreover, if a contract is surrendered the previously paid rider fees are never recouped and the surrender itself will be subject to a withdrawal penalty if made within the surrender period of the polity. Lastly, surrenders may incur tax liabilities.
If you are over 60 and live in San Francisco or elsewhere in California and have lost money on an indexed annuity or indexed universal life insurance contact Ingrid M. Evans and the other Evans Law Firm financial elder abuse, annuity and life insurance attorneys at (415) 441-8669, toll free at 888-50EVANS (888-503-8267), or by email at <a href=”mailto:firstname.lastname@example.org”>email@example.com</a>. California law provides injured seniors with restitution (getting your money back), extra damages (to punish the fraudulent conduct) and awards of attorneys’ fees and costs to the senior forced to bring an action against the wrongdoers. Our attorneys have experience with complex financial contracts and large insurance companies. We can help guide your case through a jury trial or toward an equitable settlement. We handle cases involving physical and financial elder abuse, qui tam and whistleblower law, nursing home abuse, whole life insurance and universal life insurance, and indexed, variable, and fixed annuities.
Leading providers and distributors of life insurance and fixed, variable and fixed indexed deferred annuities in California are listed below. We are not in any way suggesting that any of these carriers or distributors has done anything wrong. Rather, the list is provided solely as a reference for our readers.
AIG/American General Life Insurance Company
Allianz Life Insurance Company of North America
American Equity Investment Life Insurance Company
American General Life Insurance Company/AIG
American International Group, Inc. (AIG)
American National Life Insurance Company
Athene Annuity & Life Assurance Company
Athene Annuity and Life Company
Aviva Life Insurance Company
AXA Equitable Financial Services, LLC
AXA Equitable Life Insurance Company/AXA US
AXA Advisors, LLC
Brighthouse Financial, Inc./MetLife
EquiTrust Life Insurance Company
Fidelity & Guaranty Life Insurance Company
Genworth Financial, Inc.
Genworth Life and Annuity Insurance Company
Genworth Life Insurance Company
Guggenheim Partners, LLC
Guggenheim Partners/Security Benefit Life Insurance Company
ING USA Annuity and Life Insurance Company
Jackson National Life Insurance Company
John Hancock Life Insurance Company
Lincoln Benefit Life Company
Lincoln Financial Group
Massachusetts Mutual Life Insurance Company
Metlife/Metropolitan Life Insurance Company/Brighthouse Financial, Inc.
Minnesota Life Insurance Company
Nationwide Investor Services Corporation (NISC)
Nationwide Life and Annuity Insurance Company
Nationwide Life Insurance Company
New York Life Insurance Company
Northwestern Mutual Investment Services, LLC
Northwestern Mutual Life Insurance Company
Northwestern Mutual Wealth Management Company
Pacific Life & Annuity Company
Pacific Life Insurance Company
Security Benefit Corporation
Security Benefit Group, Inc.
Security Benefit Life Insurance Company/Guggenheim Partners
Security Investors, LLC
Security of Denver Life Insurance Company/Voya
Transamerica Life Insurance Company
Voya Financial Advisors
Voya/Reliastar Life Insurance Company
World Financial Group Insurance Agency, Inc.