August 27, 2008
I've spent nearly 20 years in the insurance business, listening to all the sales pitches for agents to use in the sales of annuity products. I'm now a fee based investment advisor - selling no insurance products - and I applaud the SEC for these proposed rules. I truly believe Indexed Annuities should be under the scrutiny of the SEC. In my opinion, these and the Variable products are sold soley for the company's bottom line and the agent's commissions, not in the best interest of the client. Only in a rare moment have I seen these used in solving problems. Most of the time they are simply used to transfer funds from client's bank accounts into insurance company balance sheets. Sure, there's no 'cost' to the client - the 'company' pays the commissions. Yeah, right! What about the hidden fees? What about the surrender charges? What about the withdrawal fees? And I need these options for what reason? And don't get me started on the 'participation' rules. If you can't explain it to a ten year old in two minutes, maybe you shouldn't be selling it. And you really shouldn't buy it, if you don't understand it!
I'm tired of agents patting themselves on the back at annual sales conventions while their clients are getting robbed. "Ol' Tom sure is a good salesman - did you see the numbers he put up this year?!" "I hear next year, the company has raised the bar in terms of qualifying for trips, again".
And, ask any commissioned agent why he or she doesn't use no-load Indexed or Variable Annuities - I bet most of them don't even know there's such a product, or won't even think about mentioning to their clients there are even such products. Imagine that, something in the best interest of the client! I know one agent who won't use them because he won't get credit for his 'trip'.
Sorry for the sarcasm, but this really gets me steamed!
Please pass this ruling in favor of the public.
Robert W Guild CLU ChFC CFS
Kirkland, WA