‘How Dare You Suggest Our Compensation Is Not Earned?’
To The Editor:
Re: “Cut Out The Confusion, and EIA Sales Should Rise,” NU, Oct. 1.
If Mr. Fisher feels that he is overpaid on Index annuities, he can give his “compensatory overages” to charity. He can also wake up and smell the coffee. I am sick and weary of the “nattering nabobs” of this business trying to tell those of us that regularly sell and produce that we are in essence, overpaid for our production. It is long past time for those of us that do understand what is happening to expose this “thinly-veiled” lie.
I am the one that brings the idea to the marketplace. I am the one that holds hands, and listens to the concerns of the buyer. I am the one that has spent many hours of personal time preparing myself to present the idea of the product accurately, fairly, and legally. I have attended the dry and boring seminars (both free and fee) that gave me the education necessary to do this job correctly. I am the one that helps guide the choices of the buyer to the appropriate product, at my risk, on my time.
How many times have I explained participation rates, and caps and fees to the inexperiencedHow dare you suggest that I am overpaid? How dare you suggest that our compensation is not earned? How can Mr. Fisher ignore the truth about the increasing sales volume of these products (from recent articles of this very publication), in spite of the fact that these products do pay a very fair compensation to those of us willing to take on the responsibility of understanding these concepts of advanced sales? Those buyers that have the correct idea about liquidity needs have no problems with the surrender period of these products.
I will make the bold assertion that it is Mr. Fisher (and reps of his ilk) that want to be able to churn money from a “matured” account with no surrender fees, and in so doing, create a brand new commission that over the same 15-year period, churned several times on an ever-increasing value, would exceed the higher percentage that he would receive on a sale today! Does Mr. Fisher really believe we were born yesterday? Shorter surrender periods could increase the product’s attractiveness, but for all the wrong reasons.
1) It would profile the idea as a security, not an insurance product (lest we should forget).
2) It would encourage the wrong mentality about investing in long-term products.
3) Companies would be subject to the “Money Magazine” investor mentalities (I can read the headlines now–”Ten index annuities to invest in today”). How very sad.
4) It would cause issuing insurance companies difficulties in maintaining adequate reserves for surrenders, and force the company to change internal outcomes to protect the capital of the company. It would force the company to think and act like a mutual fund.
In addition, the hollowness of Mr. Fisher’s claim is borne out in the title of the articleHis assertion that cutting commissions means cutting confusion is insulting to the educated among us. The two issues are unrelated, and irrelevant.
For us to truly (and correctly) represent this idea, we must assume the mentality of the prudent and caring mutual fund brokerBuy-and-hold beats buy-and-sell every time. Long term investing beats churning accounts for the client’s best interest!
Daniel J. Turner,
Underwriters Advisory Services of Ohio, Inc.,
Rocky River, Ohio
Reproduced from National Underwriter Life & Health/Financial Services Edition, October 22, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.