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Apr 23, 2022 by |

Santa Cruz County Financial Elder Abuse And Annuity Attorney: What Seniors Should Watch For In Annuity Sales Pitches

ATTORNEY NEWSLETTER

Deferred Annuities Are Complex Products

What To Watch For

Avoid Replacements And Exchanges

Deferred annuities are complicated investments.  Some bear complex qualities of both life insurance and securities products; contracts run from 50 to 100 pages or more and are filled with technical language and actuarial tables. Insurance agents are paid significant sales commissions to sell these complicated products.  Some unscrupulous sellers use high-pressure sales pitches, seminars, and telemarketing. Beware of retirement and estate planning “seminars” that may be designed to sell annuities. Any 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. 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 sales tactics, 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 Cruz 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. 

Beware of High Surrender Charges

The most significant fee associated with annuities is often the surrender charge. This is the percentage that a consumer is charged if he or she withdraws funds early. Contract surrender periods may run for ten or more years and the penalties can be as high as 10-15% in the early years of a contract.

Beware of Agents Urging You to Switch Annuities

Some sellers of annuities products urge customers to switch to another annuity, a practice called “churning.” Unfortunately, agents may not adequately disclose fees associated with switching investments, such as new surrender fees (which typically start over from the date the product is switched), or significantly altered benefits. Consumers should scrutinize the investment to find out whether the benefits outweigh the costs of switching their investment.

Be on Guard Against “Bonuses”

Agents and insurance companies may offer bonuses to entice investors, such as additional interest points on their return. The benefits of such “bonuses” are often outweighed by increased fees and administrative costs to the investor. “Bonuses” may be simply marketing gimmicks.

Don’t Make Investments You Can’t Afford

Some unscrupulous agents encourage consumers to make unrealistic investments they can’t afford, or buy a long-term deferred annuity, even though they will need access to their money for health care or living expenses. Don’t be lured into risky investments by fast talking agents and insurance companies.

Contact Us

If you are over 60 and live in Santa Cruz 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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