August 12, 2008
I am commenting on the proposed hearing regarding the SEC considering making Index Annuities be treated as Securities not Insurance. I personally find this consideration appalling. Index Annuities are simply not Mutual Funds not Variable Annuities, they are just another form of Fixed Annuitites that offfer the one thing the public like- PROTECTION from downside risks.
I have been ethically offering this to my clients for 8 years (California Teachers)in the 403(b) market and I can guarantee you that 80% of them do not like any downside risks. Making Index Annuities part of the SEC governing body, is in my estimation wrong, and will make this product more complex by putting it under the control of Broker Dealers and likely find them ways to make more money from people down the totem pole-like myself. Extra cost's will get added and this will hurt the consumer.
It is my understanding that this is being considered majorly because of abuses of the Index Annuities by agents. This is sad and regretable, but I am sure this was caused by a small percentage of Agents and Broker/Dealers. I myself and my wife who is an agent and a Representative of Plan Member Securities Corp, have consistently represented the Indexed Annuities to our clients in an ethical, responsible manner along with complete full disclosure.
Please re-consider this proposed action.
Mike Reppen
Anaheim, CA 92807