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Dec 20, 2017 by |

Marin County and California Annuity Attorney: Surrenders

ATTORNEY NEWSLETTER

What If I Bought An Annuity I No Longer Want?

What happens when you want to get out of an annuity you bought? You can ask to surrender it. But surrenders may be costly.  If you have owned the annuity for less than ten years or so, you may have to pay a surrender charge. That fee could be as high as 15% if you pull out in the early years of the annuity term and you may lose the value of income riders and other benefits you have paid for.  You also will have to pay income tax on all the investment earnings in your annuity, and if you are younger than 59 ½ you typically will be hit with a 10% early withdrawal penalty by the Internal Revenue Service (IRS).  We at Evans Law Firm do not give investment or tax advice but we represent clients, including seniors, who suffer surrender penalties and tax losses on surrenders of unsuitable annuities. If you or a loved has suffered a surrender penalty or tax loss on an annuity surrender, call the Marin County and California annuity and financial elder abuse lawyers today at Evans Law Firm, Inc. (415)441-8669 for a free review of the terms of your annuity including surrender provisions. 

The financial impact of an annuity surrender shows just how illiquid these investments are. If for example, you have the same amount of money in a bond or equity fund and want to move the money to another investment, you will pay capital gains tax on your earnings but you will not be hit with a withdrawal penalty or tax penalty.  Annuity salesmen emphasize the tax deferral benefits of annuities over such outright investments but keep in mind that your bond or equity fund can be an IRA or other private retirement investment plan that is also tax deferred.  While you might pay the 10% IRS penalty on withdrawals from such accounts before age 59 ½, the IRS provides exceptions for medical expenses, health insurance, college costs, a first home purchase and the like.  There are no broad exceptions to early annuity withdrawals. 

Each situation is different and we at Evans Law Firm do not provide investment or tax advice when it comes to purchases and surrenders. We do however represent clients who have suffered losses from surrendering an annuity they no longer want and that may very well have been unsuitable in the first place. You may also have incurred high commissions, rider fees, and other charges that are part of your economic loss. California law provides additional protections for senior buyers who have suffered these types of losses, including extra damages and mandatory attorneys’ fees in cases of financial elder abuse.

Some of the major annuity and life insurance providers in California are:

Allianz Life Insurance Company of North America

Allstate Life Insurance Company

American Equity Investment Life Holding Company

American National Insurance Company

Athene Annuity and Life Company

AXA Equitable Life Insurance Company

EquiTrust Life Insurance Company

Fidelity & Guaranty Life Insurance Company

Forethought Life Insurance Company

Genworth Life Insurance Company

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 Financial Group/The Lincoln National Life Insurance Company

MassMutual/Massachusetts Life Insurance Company

MetLife/Metropolitan Life Insurance Company

Midland National Life Insurance Company

Mutual of Omaha

New York Life Insurance Company

Pacific Life Insurance Company

Prudential Life Insurance Company

Security Benefit Life Insurance Company/Guggenheim Partners

Transamerica Life Insurance Company

Voya/Reliastar Life Insurance Company

Contact Us

If you or a loved one been sold an unsuitable annuity contact Marina County and California annuity and financial elder abuse attorney Ingrid Evans and other attorneys at the Evans Law Firm at (415) 441-8669 for a free consultation, or by email at <a href=”mailto:info@evanslaw.com”>info@evanslaw.com</a>. Our attorneys have experience with complex financial contracts and large insurance companies. We can help guide your case through a FINRA arbitration, 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.

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"Contacted Ingrid on an elder financial abuse case - she was responsive, knowledgeable, and easy to work with. You can tell she is passionate about this area of law and has the experience to back it up. She is an excellent choice if you are looking for a results driven attorney and highly effective advocate."