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Mar 21, 2022 by |

San Francisco Financial Elder Abuse And Annuity Attorney: Deferred Annuities Are Unsuitable For Seniors

ATTORNEY NEWSLETTER

Agents Target Seniors To Buy Annuities

Annuities Aer Expensive And Tie Up Your Money For Years

Substantial Penalties For Withdrawals During Early Contract Years

Evans Law Firm, Inc. recommends seniors avoid deferred annuities because deferred annuity contracts are expensive and complicated and tie up a senior’s money for years.  High-pressure or deceptive sales tactics 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. §§ 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.  If you are over 60, live in San Francisco 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. 

Withdrawal Penalties/Surrender Charges

Deferred annuities have surrender charges if you withdraw your money early. Surrender periods vary from 2 years to 10 or more, and the corresponding charges typically decline with time. For example, a deferred annuity with a 10-year surrender period would charge 10% on money withdrawn the first year, 9% the second year, 8% the third year and so on.  Bear in mind that withdrawn before age 59½ may be subject to a 10% federal tax penalty.     Any withdrawal will be taxed as ordinary income the year it’s received.  Always consult with your tax professional before making decisions on the tax ramifications of annuities or any retirement vehicle

Fees And Commissions

All annuities have commissions and annual fees. These are typically built into the policy so you won’t see the costs taken out each year. Commissions can range from 6% to 10%, depending on the type of annuity.  As a rule of thumb, the longer the surrender period and more complex the annuity, the higher the commission.  Ask your agent or representative what the commission is before buying. If the agent says it’s built in (so) you’re really not paying any commission, that is not true.  The commission is there, even if you don’t see it.  Also, if an agent says you will recoup any commission by means of a “premium bonus,” be skeptical.  Bonuses are marketing gimmicks; you can never withdraw the bonus amount and if you surrender all or part of your policy, the “bonus” will disappear.  Annual fees can also be anywhere from 1-3% depending on the contract’s complexity and any riders to the policy.

Contact Us

If you are over 60 and live in San Francisco 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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