July 16, 2008
I believe bringing Fixed Index Annuities (FIA) or Equity Index Annuities (EIA) is essential in protecting the consumer. Under current legislation these products are regulated by the insurance industry who does not have standards comparable to FINRA or SEC for solicitation and suitability of recommendations. Because of this fact there are hundreds of thousands of unlicensed insurance agents, who do not understand captial markets, or the product they are selling. These agents do not understand the crediting method on these products, they do not understand the surrender periods, they do not understand the free withdraws, or any other features associated with an FIA or EIA. This is a dangerous situation for the public at large, since these agents are holding themselves out as finanical professionals and they are attempting to provide financial planning services and offer securities advice without the proper licenses or registrations. Most, if not all, of these agents are selling these products as an alternative to equity investments, which they are not, nor were they intended to be, and without oversight form an SRO like FINRA or from a Government Agency like the SEC, these investments will continue to be mis-sold and consumers damaged in the process, quite possibly irrevocably.