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Apr 15, 2022 by |

Orange County Financial Elder Abuse And Annuity Attorney: Unsuitable Deferred Annuities For Seniors

ATTORNEY NEWSLETTER

Deceptive Sales Practices

Downsides of Deferred Annuities For Seniors

Avoid High-Pressure Sales Tactics

Insurance agents are paid significant sales commissions on sales of certain forms of deferred annuity insurance products.  Any high-pressure or deceptive tactics to sell these products, and sales of unsuitable annuities, violate the law and constitute financial elder abuse when the targeted consumer is a senior.  Cal. Welf. & Inst. Code § 15610.30 (definition of financial elder abuse); Cal. Ins. Code §§ 790 et seq. (Unfair Insurance Practices Act) and 10509 (suitability requirement).  Senior victims may be entitled to damages and an award of attorneys’ fees and expenses for bringing a case.  Cal. Welf. & Inst. Code § 15657.5.  Regardless of the sales tactics used by agents, Evans Law Firm, Inc. generally recommends seniors avoid certain types of deferred annuities because deferred annuity contracts can be expensive and complicated and tie up a senior’s money for years.  If you are over 60, live in Santa Clara County, or elsewhere in California and own a deferred annuity (such as a fixed indexed annuity), call us today at 415-441-8669 (or toll free at 1-888-50EVANS) for a free review of your policy. 

Primary Disadvantages of Annuities

If you are considering an annuity that has been proposed by an agent, we urge you to consider the following:

  • Annuities are long-term contracts with penalties if cashed in too early.
  • Annuities require you to lose control over your investment.
  • Some annuities earn little to no interest.
  • Guaranteed income can not keep up with inflation in certain types of annuities.
  • The annuity might not provide a death benefit to your beneficiaries.
  • Annuities offer regular but limited liquidity, sometimes none at all.
  • Fees can be high in investment-based annuities.

Avoid Exchanges And Replacements

If you’ve already purchased an annuity, be especially wary if an agent recommends exchanging your existing annuity for a new one. Unsuitable contract exchanges violate California law (see, e.g., Cal. Ins. Code §10509.914), but agents still push inappropriate (and costly) exchanges.  There are several dangers for consumers in these exchanges: surrender penalties on the surrendered contract, tax on the proceeds from the surrendered contract, and the surrender period resets under the new contract, tying up your money for even more years.  Another danger for consumers is where agents “churn” annuities by recommending a succession of surrenders and exchanges.  This activity is illegal.

Contact Us

If you are over 60 and live in Orange County or elsewhere in the State of California and have an indexed annuity, we can review your contract for free.  You can reach Ingrid M. Evans at Evans Law Firm, Inc. at (415) 441-8669, or toll free at 1-888-50EVANS or by email at <a href=”mailto:info@evanslaw.com”>info@evanslaw.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

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

PacLife

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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