November 13, 2008
Gentlemen:
I support rule file S7-14-08.
Equity Index Annuities need to be regulated. As a CFP with almost 30 years in the financial planning field I do not feel these type of annuities to be a viable option for most clients. Any investment that is tied in any way to the security markets should require a securities license to sell it.
In the last 18 months I have had two new clients come to me who were basically sold a bill of goods along with the Equity Index annuity by an insurance agent. These were women, aged 52 and 61 respectively, who had contracts with large front end loads. The contracts were less than 3 years old. When each client told me what they thought they had, it differed drastically from what was actually purchased. Such confusion is common. Much of their investable assets had been cashed in to fund the annuity - what was supposedly told to them by the agent made my skin crawl.
A business associate and I have repeatedly written to our State Department of Insurance complaining about one particular agent who conducts seminars in our area and sells the equity index annuity as a solution for all. We haven't had any response, and he still does bad business.
With all the financial upheaval today we need prudent, transparent, understandable annuity contracts.
Thank you.
Sara I. Seasholtz, CFP
Preferred Financial Strategies