Calif. Regulator Demands Annuity Suitability

California Insurance Commissioner John Garamendi is asking life insurers doing business in the state to adopt suitability standards for selling annuities to seniors.[@@]

In a letter to insurers, Commissioner John Garamendi said his office has received numerous complaints about problems with annuities sold to seniors, including sales of products that do not mature until after the insured’s death.

Other problems Garamendi cited include failure to disclose tax consequences of annuities; unexpected surrender charges; and loss of death benefits or other types of benefits when selling a deferred variable annuity.