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Life Health > Annuities > Variable Annuities

Letters

By thinkadvisor

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In response to “The annuity industry needs its own Series 7 exam…now”

I think you are on the right track Stan. The annuity industry is filled with folks who have no specific related education or substantive credentials but are really just good salespeople. It’s no wonder the regulators are coming after those who call themselves “financial advisors” but are really product salespeople. I don’t think that requiring the Series 7 solves the problem but it is a step in the right direction. When regulators finally implement a fiduciary standard (along with the appropriate education requirements) that apply to anyone making financial recommendations, maybe we can make some headway.
Perry Vasquez

Stan’s a flipping idiot. A Series 7 license has nothing to do with an indexed annuity, nor does testing make someone ethical. In my 10-plus years of experience in the field selling both mutual funds and fixed indexed annuities, I have seen just as many one-sided sales from the securities industry. The best fix is to fine these people once and yank their license for a second offense. Stan is completely wrong!
Mike N.

“No one in the annuity industry can argue that it’s acceptable for someone to pass a life insurance exam on Monday and be able to sell a fixed indexed annuity on Tuesday.” So, you’re saying that making the advisor take the Series 7 somehow will provide MORE knowledge to sell a fixed annuity? This argument is highly illogical, and more regulation will not increase ethical practices. When will people learn that adding more regulation will not make immoral people moral? It just adds to the cost to the vast majority of folks who are making an acceptable attempt to make an honest living.
Robert Williams, JR



In response to “Don’t leave customer service to chance”

Hiring people with the right approach is a great head start but you are right that customer service training is critical to delivering a consistently high standard of service. 
Jon Davies

In response to “A fresh approach to managing risk in variable annuities”

From the consumer’s point of view, the more investment risk, the better insurance value. The less risk, the more profitable for the insurance company. There is a serious conflict of interest when it comes to investment management. Avoid annuities that force model portfolios, allocations to cash, bonds, options and other risk management tools, or give discretion to the insurance companies. These serve the interests of the insurance companies, not the consumer. How are high-quality bonds, cash and risk reduction strategies going to overcome 4 percent-plus of fees in such a low interest rate environment? Why would you want to insure low-risk assets that will have no chance of growing, let alone keep pace with costs?

This stinks. Go back to the drawing board. Consumers and financial advisors, send your dollars to companies that do not have investment restrictions and use variable annuities to manage the uncertainty of stocks, commodities and real estate.
Roy Jones

thinkadvisor

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