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Jan 7, 2022 by |

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

ATTORNEY NEWSLETTER

How Deferred Annuities Work

Pitfalls For Seniors

Questionable Sales Tactics

Some insurance agents become quite aggressive when selling insurance products like certain forms of life insurance and deferred annuities. Sales of these policies generate substantial sales commissions and agents may not fully disclose all the facts about these policies in order to close a sale quickly.  Do not allow yourself to be rushed into any transaction.   Deferred annuities are especially complex; policies can run from 50 to over 100 pages long with endorsements (called riders) sold to enhance your benefits. Evans Law Firm, Inc. recommends against deferred annuities for seniors because we have seen too many older consumers lose money due to sales commissions, withdrawal (or surrender) penalties, annual fees, and low returns on invested premiums.  Sales and recommended surrenders and exchanges of deferred annuities to seniors may constitute financial elder abuse claims under Cal. Welf. & Inst. Code § 15610.30. Questionable sales tactics, like unannounced home visits or falsified applications, are illegal.  See, e.g., Cal. Ins. Code § 790 et seq. (Unfair Insurance Practices Act).  If you are over 60, and live in San Francisco or elsewhere in California and would like us to review your annuity contract, call us today at 415-441-8669 (or toll free at 1-888-50EVANS) for a free review of your policy. 

Surrender Penalties

Probably the principal reason we recommend against deferred annuities for seniors is because the surrender penalties you will pay under these contracts if you need your money back.  Once you are sold an annuity, you are locked in.  If you need your money during the first several years of the policy, you will have to pay a penalty called a surrender charge. The surrender charges can be high – in some contracts this charge may be as high as 15%; and the surrender period can last as long as ten years. If you think you will need access to your money during the surrender period, do not get a deferred annuity.

Home Visits By Agents

An insurance agent cannot enter your home uninvited. Cal. Ins. Code § 789.10. And they must leave immediately if you ask them to.  Here’s what else the law requires:

  • Agents must give you 24-hour written notice before they come. 
  • When they first contact you, they must tell you why. For example, they should say they want to talk about insurance.
  • They must tell you the name of the insurance company they represent.
  • They must tell you the names and titles of everyone coming to your home.
  • Each person should give you a business card or other written identification with their name, business address, telephone number, and any insurance license numbers.
  • You can ask people to leave at any time.

The person who offers to sell you an annuity must give you honest and accurate information on the terms and rules of the annuity, as well as its costs and benefits. Cal. Ins. Code § 785(a)(“All insurers, brokers, agents, and others engaged in the transaction of insurance owe a prospective insured who is 65 years of age or older, a duty of honesty, good faith, and fair dealing.”)  If you already have an annuity and the agent recommends you exchange it for a new policy, there are a number of important consequences they must disclose to you.  Cal. Ins. Code §§ 789.8 and 10509-10509.9.

Contact Us

If you are over 60 and live in San Francisco or elsewhere in the Bay Area or throughout California and would like a free review of your policy contact Ingrid M. Evans at Evans Law Firm, Inc. at (415) 441-8669 (or toll free at 1-888-50EVANS), or by email at <ahref=”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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