Loss Of Control Of Investment
Penalties On Withdrawals
Sales Commissions, Contract Fees And Low Returns
Deferred annuities are complex, long-term insurance products which are not generally suitable for older consumers. Evans Law Firm, Inc. recommends against certain types of deferred annuities, such as fixed indexed annuities, for older consumers because these complex, expensive insurance policies may tie up a senior’s money for years and impose significant penalties if you need your money back. Further disadvantages of these complicated insurance policies are low returns, high commissions and annual fees and the long delay (surrender period) before you will ever receive any income payments. Even if you are able to wait out the surrender period (which can be 10 or more years), the upfront sales commission (taken out of your premium) and annual fees incurred while you wait for the payment period to begin may diminish the return on your money. Questionable or incomplete sales tactics and presentations and the policies themselves may constitute violations of insurance laws and elder protections. Cal. Welf. & Inst. Code § 15610.30 (definition of financial elder abuse); Cal. Ins. § 790 et seq. (Unfair Insurance Practices Act). Relief for injured seniors includes awards of attorneys’ fees and expenses for bringing your case. Cal. Welf. & Inst. Code § 15657.5. If you are over 60, live in Los Angeles, Orange County or elsewhere in the State of California and own a deferred annuity, call us today at 415-441-8669 (or toll free at 1-888-50EVANS).
Reasons Why Deferred Annuities Are Poor Choices For Seniors
Here are three primary reasons any older consumers should think long and hard before allowing an insurance agent or advisor to sell them a deferred annuity:
- Annuities are long-term contracts with penalties (surrender charges) if cashed in too early. A surrender charge applies when you make more withdrawals than you’re allotted. Your insurance company could limit withdrawals particularly during the early years of your contract. Surrender fees are often as high as 15% and can apply for periods up to ten years or more.
- Annuities require you to lose control over your money. Because you are locked into an annuity due to the surrender charges for pulling out, you cannot personally manage your money. With a mutual fund or individual stock and bond portfolio and bank deposits you can move your money around as the market changes or interest rates move. You can’t do that with money in an annuity.
- Annuities incur annual fees. Annuities are costly compared with mutual funds and CDs. In addition to the upfront sales commission, there are annual administrative charges and rider fees (for policy “enhancements”) that are taken out of your funds every year regardless of whether you are receiving interest on your money or not.
If you are over 60 and live in Los Angeles, Orange County, or elsewhere in the State of California and have a deferred annuity or universal life insurance contract, call Ingrid M. Evans at Evans Law Firm, Inc. at (415) 441-8669, or toll free at 1-888-50EVANS or contact us by email at <a href=”mailto:firstname.lastname@example.org”>email@example.com</a>.
Some significant issuers and distributors of 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. 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.