Now that I’ve gotten your attention, we can change the word tax to “fee” if that will make you feel better, but the bottom line is that it’s time to change the annuity game.
In my previous articles and rants, I have factually pointed out how the annuity industry continues to ignore unsuitable sales and advertising practices, and seems to care less about protecting the brand. It’s a fact that nothing is enforced, and there are no repercussions for anything said or promoted to achieve the beloved annuity sale. If you disagree with this, then you are from another planet and probably are under the delusion you have six pack abs.
What I am proposing, and I’m not going away on this, is a $25 fee on every single annuity application submitted to any carrier. The annuity carrier should care less, and will just deduct this $25 from the agent’s commission. It’s no skin off their back, and there should not be one carrier that objects to this agent fee.
Where this $25 ticket fee will go is the true game changer. There will be a 501c3 non-profit organization created called The Annuity Partnership (TAP) that will have three primary functions ongoing. Those three specific directives will be:
- EDUCATION: ongoing annuity agent education and the creation of legitimate annuity certifications
- BRANDING: enhancing the annuity brand while framing a consistent consumer message
- PROTECTION: running “factual mirror” ads to combat the current misinformation and hype on the internet, TV, and radio
This is going to happen eventually, so you might want to pay attention and make a decision if you want to be a part of the solution, or the person that lets a bad thing happen right in front of them without taking action. I’m hoping that most agents aren’t cowards and actually want to protect their livelihood ongoing.
Just as an example, let’s say there are 500,000 annuity applications per year with carriers who are on board with the idea (eventually, they all will be involved). At $25 per application, that’s $12.5 million per year going to The Annuity Partnership (TAP) non-profit organization. That amount is more than $1 million per month that can be spent on the three TAP goals. Can you even imagine the positive impact this would create for the annuity industry?
It’s important to point out that this would not be stepping on the effective and ongoing work that NAFA and Kim O’Brien are doing by implementing their specific bylaws and lobbying goals. The Annuity Partnership (TAP) would be run, overseen, and directed by agents only. No carrier or FMO representatives would be allowed to participate. No one involved with TAP would get paid a penny, and any personal expenses would be picked up by the participating agent. There would be no monetary incentive, just the incentive to protect and enhance the annuity brand.
The Annuity Partnership (TAP) would have agent representatives from every state that would volunteer to represent their specific region. There would also be three separate agent volunteer boards overseeing the three directives—Education, Branding and Protection. These boards would make decisions on how EVERY PENNY of the money would be spent. TAP will be set up as a non-profit, and would strictly abide by those laws and the books would always be open for the haters, doubters and status quo keepers to review and analyze at their leisure.
All of us are tired of the “made up” certifications that hoodwink the public and mean absolutely nothing. I’ve always said that every agent should be required to read and get tested on John Olsen & Michael Kitces’ book “The Advisors Guide to Annuities.” That should at least be a starting point, but real ongoing education courses and standards have to be a primary goal along with the creation of real annuity certifications similar to CFP, CFA and CIMA that would bring real credibility.
Imagine The Annuity Partnership (TAP) spending hundreds of thousands of dollars per month on consumer radio, TV, and Internet ads promoting annuities in the correct light. There would never be any name or lead capturing, and it could start creating and implementing our own “annuity milk” type ads. The branding would be catchy, consistent and factual.
This is the part that will be a lot of work the first year or so, but will not be as cumbersome once agents find out that their overhyped message will be counterbalanced in their own marketplace with a factual message from TAP. If an agent is running a misleading ad on local TV or radio, the local TAP agent representative will alert the “Protection Board” and factual counter ads will be run in the same local market to combat the hyped message. Imagine that! Talk about powerful. With the 50 states having TAP representatives, it won’t take long for the annuity cowboys to realize that the rodeo is over. Same thing would go for the Internet pop-up ads and videos. TAP would go head to head with them, and buy the mirrored spots to counteract the too-good-to-be-true videos and other annuity nonsense currently corrupting the web.
If $25 per application seems too high for you as an agent, then you need to reevaluate what you are doing for a living. If the carriers and FMOs have a problem with this pro annuity idea, then they are hypocrites and will be called out publicly for their lack of vision and the fact that they obviously don’t care about anything other than slinging product.
To conclude this initial article, but to just get started with this idea, I have no personal interest in heading this organization up. The Annuity Partnership (TAP) has to be a pure representative democracy and a true non-profit with the goal of achieving the greater good for all things annuity.
Just to let you know that I’m not kidding with this, the domain names have already been purchased, and the 501c3 paperwork is in the process of being filed.
Attention annuity industry… the ball is now in your court. You are being called out. It’s time for a change, and it’s time to take control of the wild wild west of annuity sales and protect this valuable brand ongoing.
What are you going to do? It’s your call now.