August 2, 2008
Please reconsider any alteration of how annuities, specifically Indexed Annuities, are defined under the Securities Acts of 1933 1934.
Indexed Annuities by definition, structure, design, requirements of insurance companies issuing all such contracts to absorb 100% of the investment risk, and in particular the guarantee of principal - are all consistent with a fixed guaranteed insurance product, and CANNOT be accurately defined as a "security".
The Indexed component of Indexed Annuities are simply an alternative where clients can allocate their premium, when seeking to obtain a greater than average rate of return a Fixed-only account does not historically provide. So even if the client allocates some or all their premium into the Index option, the contract is still a Fixed Annuity.
The Indexed component is therefore NOT invested IN the market, rather premium is shadowing the performance of a popular market index, such as the SP 500. While upside performance is not guaranteed, all downside risk is eliminated inside the Index Annuity contract. These are important facts we implore you to keep in mind...
Thank you,
James R. Brown, MBA
Kansas City Metro Area