Why do the pundits hate annuities?

Some of the most popular articles on LifeHealthPro (as measured by the vigorous comments that they engender) are those that take shots at (or sing the praises of) one type of financial or insurance product versus another.

In my opinion, these debates often display serious misconceptions about how insurance products work — and these misconceptions are not limited to a few online comments. 

The detractors are often widespread, ranging from “experts” both inside and outside of the insurance business to celebrity financial pundits. It is sometimes hard to tell whether objections are based upon a lack of knowledge or are a dishonest attempt to gain a competitive advantage for the particular hammer in their toolbox.

But regardless, those of us who do understand these products often struggle to counter with honest, simple explanations. Insurance can get complicated and is boring. So simple but misleading criticisms are easy. Honest answers are hard.

That’s the inspiration for the video series we have started. We want to attempt to address the various misconceptions and controversies that we see both online and elsewhere with short, simple and, we hope, entertaining videos.

These videos are not deep dives into the technicalities of insurance (at least not yet) and the intent is not to defend products against all criticism. We simply want to educate where we see misconceptions by providing some tools and ideas that may help.

Our first video series foray is on annuities. I am sure you’ve seen the ads — ”I Hate Annuities and You Should Too.”  Whether it is Ken Fisher, Suze Orman or Dave Ramsey, annuities are a frequent punching bag by the various celebrity pundits. Why the hate?  Here is our introduction: