Comments on: Congress sells out seniors: No SEC regulation of indexed annuities

By: jonk

jonk — Thu, 19 May 2011 14:25:05 +0000

Or, to boil it all down to a simple sentence: ours is a government Of, By, and For the corporations. Great article Jane.

By: Jane

Jane — Tue, 08 Mar 2011 22:49:24 +0000

Here, here. The industry renamed these variable products “fixed annuities,” to help evade regulation by the SEC. And their dropped the work “equity” from the name. (It used to the Equity Indexed Annuities; now I get hate mail if I use that term.) Anyway, they’re kinda fixed (to avoid more regulation) but kinda linked to stocks (but don’t call them variable) and rise with the S&P (but don’t call that equity). Where there has to be so much subterfuge in selling, you know you have a product that the industry doesn’t want to bring out to the light of day.

By: Richard

Richard — Tue, 01 Mar 2011 06:16:02 +0000

The supporters of EIA’s are so benevolent. They are making more commissions than they ever would in mutual funds selling these products. It’s interesting when they refer to the S&P 500 in there sales process, however, EIA’s are not listed as variable products. So, where does the S&P fit in this equation except to mislead consumers. They also don’t enjoy the same scrutiny in there sales practices as Variable Annuities and the person who said VA’s are bad is absurd. Last but not least is the surrender period for many of these products. If EIA’s are so great why is it that the largest mutual insurer in America won’t sell them and will terminate any contracted agent who does.

By: Jane

Jane — Wed, 24 Nov 2010 17:59:26 +0000

I have written positively about some annuities. See http://janebryantquinn.com/2010/09/have-an-annuity-with-lifetime-income-guarantees-dont-give-it-up/
I have written negatively about equity-indexed annuities (which the industry likes to call “fixed annuities,” even though they aren’t fixed), due to lack of disclosure, hidden fees and, yes, abusive sales, as several lawsuits by attorneys general can attest. the National Association of Insurance Commissioners promulgated special rules for the sale of EIAs because of the abuses.

By: Jane

Jane — Tue, 20 Jul 2010 05:11:21 +0000

I haven’t demonized the product. I have strongly objected to abusive sales and lack of disclosure about costs.

By: Jane

Jane — Tue, 20 Jul 2010 05:10:24 +0000

Insurance regulators have allowed abusive sales of indexed annuities for years and years and years. At least the SEC would require the sellers to disclose the cost. Salespeople keep telling customers that these annuities don’t cost them anything. (That’s something else the SEC would stop.)

By: jim

jim — Thu, 08 Jul 2010 11:11:16 +0000

I have read about annuities, from a very limited skim view, but do not trust any of them, with one exception. The immediate pay fixed annuity, if you simply need lifetime income and need to convert a savings or certain amount of money into a stream of income, rather than a holding of savings, and for life.

By: Geoffrey

Geoffrey — Wed, 07 Jul 2010 19:23:18 +0000

And you have faith in the SEC? Are you kidding? lets take a look at lawsuits in the securities industry vs insurance industry. Let’s talk about abusive sales from investment brokers. Those sales that have resulted in millions of dollars in losses to their clients? Sometimes ALL of their money. The SEC doesn’t exactly inspire confidence.

Have their been inappropriate sales within the annuity sector? yes! Have clients lost their life savings? NO! I stand by the fact the SEC wanted control over FIA’s because their are billions of dollars coming out of the stock and bond markets. They control the market they can shut down FIA’s.

As far as your response about “maybe” gains in an FIA..Two points, one is I will take maybe gains with NO CHANCE of loss any day. Second, Are you saying the stock market isn’t “MAYBE” gains? I would like to see that market.

Can you find out what the “fee” is for my CD, money market, Savings account at the bank? I’d like to know that too…Because I do know they make lot’s of money from those deposits and pay pitiful returns. That is much of a fee to any client as your example.

By: Doughboy

Doughboy — Wed, 07 Jul 2010 18:35:50 +0000

Jane–As a former RIA I decided to move ALL my clients out of the rigged stock market in March of 2000 and into Equity Indexed annuities for the sole purpose of protecting their investments. Not one of them is unhappy with that decision to date.If you really want to understand the markets I suggest you write about the Plunge Protection Act and how they ( Goldman Sachs etc.) currently manipulate the markets. How about doing some research into the Fat Finger Flash Crash, where’s the transparency there?

Indexed annuities are insurance products and always will be. With all due respect, please stop demonizing a product that you REALLY don’t understand that all my clients like and are very happy with.

By: Jane

Jane — Wed, 07 Jul 2010 17:35:20 +0000

Thanks, robocop, for the link to the Wharton study. It is interesting but has limitations. The biggest ones are that participation was voluntary, insurers got to choose which EIAs it submitted for analysis, and in some categories the selection was small. I look forward to more work in this area. Still, the returns aren’t my issue. My issue is whether EIAs are properly sold.