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May 9, 2018 by |

Santa Clara County and California Annuity and Financial Elder Abuse Attorney: Indexed Annuities

ATTORNEY NEWSLETTER

Understanding Indexed Annuities

Insurance agents are seizing the volatile stock market and rising interest rates as selling points in pushing indexed annuities. Concern over market volatility is understandable but indexed annuities are not the answer.  The annuities lawyers at Evans Law Firm, Inc. recommend a very close look at indexed annuities before you follow any insurance agent’s advice on these products.

The Santa Clara County and California annuity and financial elder abuse attorneys at Evans Law Firm, Inc. have seen policyholders economically harmed by the way in which these complicated policies actually work after they go into effect. Much of the harm comes from hidden fees and charges buried in the complex terms of these contracts and any riders (endorsements) attached, particularly when it comes to partial or full surrenders of the policies. California law provides very specific disclosure rules especially for seniors who are sold these policies by their agents and advisors. If you or someone you know is over 60, lives in California, and has suffered a loss on an indexed annuity as a result of a full or partial surrender or rider or other fees, call the California annuity attorneys at Evans Law Firm, Inc. today at 415-441-8669 for a free review of the policy.[1]

Take A Closer Look

Agents sell these policies as protection against the volatility of the stock market. Most of the money invested in indexed annuities is committed to bond and fixed income funds.  That’s explained by agents as your downside protection.  The upside (any return above the contract’s guaranteed rate) is put in derivatives, or call options on the specific market index selected for that portfolio. The supposed upside, however, is limited by policy features such as caps, participation rates, and spreads.  The bottom line is that indexed annuities yield at most only a marginally higher return than straight fixed annuities and a significantly lower return than direct equity investments or indexed mutual funds.

The other major drawback with these products is that your money will be tied up for a long time. Any early withdrawal will be subject to surrender charges and forfeiture of the “extra” return your account was earning over the guaranteed rate.  Even if you hold out to the end and refrain from early withdrawals, the fees and expenses in these accounts, together with the upfront sales commission, may erode your return significantly if not wipe it out.  Bottom line is, beware. Indexed annuities are extremely complicated, and this is just a brief overview.  Always consult a qualified professional who does not stand to gain from any purchase and always consult your tax advisor before making any purchase. 

Contact Us

If you or a loved one is a resident of California over age 60 and has suffered loss on an indexed annuity as a result of surrender charges or other fees, contact Santa Clara County and California annuity and financial elder abuse attorney Ingrid Evans and the other attorneys at Evans Law Firm at (415) 441-8669, 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 jury trial or toward an equitable settlement.  We handle cases involving physical and financial elder abuse, nursing home abuse, qui tam and whistleblower law, whole life insurance and universal life insurance, and indexed, variable, and fixed annuities.

Some of the major annuity and life insurance providers and distributors in California are listed below. We do not suggest in any way that any of these carriers or distributors is guilty of any wrongdoing.  Rather, the list is provided solely for our readers’ reference.

Allianz Life Insurance Company of North America

American National Life Insurance Company

Ameriprise Financial/RiverSource Life Insurance Company

Athene Annuity and Life Company

Aviva Life Insurance Company

AXA Equitable Life Insurance Company/AXA US

Bankers Life Insurance and Casualty Company

Brighthouse Financial, Inc./MetLife

Crump Life Insurance Services, Inc.

CUNA Mutual Group/CMFG Life Insurance Company

EquiTrust Life Insurance Company

Fidelity & Guaranty Life Insurance Company

Forethought Life Insurance Company/Global Atlantic Financial Group

Genworth Life Insurance Company

Global Atlantic Financial Group/Forethought Life Insurance Company

Guardian 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 Benefit Life Company

Massachusetts Mutual Life Insurance Company

Metlife/Metropolitan Life Insurance Company/Brighthouse Financial, Inc.

Nationwide Life Insurance Company

New York Life Insurance Company

Northwestern Mutual Life Insurance Company

Pacific Life Insurance Company

Principal Financial Group

Prudential Life Insurance Company

Raymond James Insurance Group

RiverSource Life Insurance Company/Ameriprise Financial

Security Benefit Life Insurance Company/Guggenheim Partners

Symetra Life Insurance Company

Transamerica Life Insurance Company

Unum Life Insurance Company of America

Voya/Reliastar Life Insurance Company

[1] We do not provide investment or tax advice, but can represent you if you have suffered financial loss on a partial or full surrender, including any tax loss you may have incurred.

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