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Jun 25, 2021 by |

Los Angeles Annuity and Financial Elder Abuse Attorneys: Seniors Should Understand Annuities Before They’re Sold One


Long-Term Insurance Policies 

Pressure Sales Tactics

High Commissions, Hidden Fees And Surrender Penalties 

All deferred annuities are complicated and risky, indexed annuities are particularly complex and full of risk.  These complications and risks are especially dangerous for seniors; if a policyholder needs his or her money back for an emergency or because their care expenses have increased, any withdrawal of funds will be subject to a sizeable withdrawal penalty, also known as a surrender charge.   In general, Evans Law Firm, Inc. recommends that seniors avoid deferred annuities because sales commissions are high, policies tie up your money for many years, and returns are routinely not as high as advertised “teaser” rates. There are simply too many pitfalls in these complex insurance products and we have seen many seniors lose money on them over the years.  If you do go forward, pay attention to the paperwork; an agent may try and qualify you for a larger annuity than you can afford.  If you have already been sold an annuity and you’re over 60 and live in Los Angeles, Orange County, or elsewhere in California and have suffered a loss due to cancellation, replacement, fees, or full or partial surrender, call us today at 415-441-8669 (or toll free at 1-888-50EVANS) for a free review of your policy. 

Sales Commissions and Phantom “Bonuses”

An agent earns a significant sales commission every time he or she sells an annuity or persuades a consumer to trade in (exchange) an existing annuity for a new one.  This commissions comes right out of your initial premium payment.  If the agent tells you the policy’s “premium bonus” will return that money to you over time, don’t buy it.  Policy bonuses are phantom amounts that you will most likely never see.  It’s never a fund of money that you can withdraw separately – ever.  Further, if you need to make a withdrawal or surrender to get your money back, the “bonus” your account was credited with on paper disappears.  If the market improves and you want to exit the annuity to achieve a better return, you will pay surrender penalties that can wipe out any gain (if any) your money may have earned, and never see any repayment to you of the commission amount.

Costly Withdrawals And Exchanges

Surrender penalties and market value adjustments (MVAs) that decrease withdrawals of your own money are ways the annuity carrier protects itself from withdrawals by you to invest your money somewhere else.  Surrender periods can last for ten years or more and the percentage penalties can be as high as 15%.  If you had the same investment in a direct mutual fund, you would not be penalized if you decided down the road to switch investments.  Annuities in other words lock you in. That’s a problem too.  If you do stay in, the fees, caps, and participation limits will cut into your return.  Whatever you do, always consult a professional with nothing to gain from a sale before you buy and always consult your tax advisor because any decision regarding annuities has ta consequences.  If an agent recommends replacing your existing contract, be extra careful.  Those kinds of transactions can trigger large tax liabilities, incur surrender charges, wipe out “bonuses,” and reset the clock on your surrender penalty period under the new policy.

Contact Us

If you or a loved one has suffered loss on the surrender, termination or transfer of an annuity in Los Angeles, Orange County or elsewhere in California call Ingrid M. Evans at Evans Law Firm, Inc. at (415) 441-8669 (or toll free at 1-888-50EVANS)  or by email at <ahref=””></a>. 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.

Annuities and life insurance produce large sales commissions for brokers but are often inappropriate products for consumers, especially seniors.  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

Athene USA

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.

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