Annuities are complex products that often have hidden fees and costs. It is recommended that consumers carefully review any policy and consider their options before purchasing any annuity policy.
Both indexed and fixed annuities have risks for the consumer. Penalties such as surrender charges and forfeiture charges can make annuities illiquid, as the consumer will face steep financial penalties if he or she wants to withdraw money before a certain period. In the event of the death of the policy holder, their heirs are often penalized as well. Agents may also offer “teaser” interest rates to entice someone to buy an annuity, but the rate may change after the first year of the policy. Consumers also may be paying for the agent’s commission or bonuses.
Fidelity and Guaranty Life Insurance Company has been in existence for over fifty years, and has less than 200 direct employees, instead relying on a network of over 25,000 independent agents to sell their products. They offer policies throughout the United States, with California being the state where FGL does the largest amount of business, and they currently have over 700,000 customers.
Fidelity and Guaranty Life offers indexed and fixed annuities, and their website describes some of the features, as well as the pros and cons, of each. Under fixed annuity contracts, the life insurance company pays an interest rate for a specific period at the time the annuity is purchased. With indexed annuities, the rate is determined by a formula based on fluctuations of a market index such as Standard & Poor’s 500. They may offer higher rewards than fixed annuities, but also involve greater risk.
Evans Law Firm, Inc. handles insurance fraud and annuity fraud lawsuits, and is currently investigating claims related to Fidelity and Guaranty Life Insurance Company. If you have purchased, or are considering purchasing, an annuity policy and want to know whether it is a suitable investment for you, please contact Evans Law Firm, Inc. at 415-441-8669 or via email at firstname.lastname@example.org.