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[senior-advisor-indiana]

Do you think it is unethical to sell annuities to seniors?

 

[Crabcake Johnny]

No. What's unethical is not telling them it's life insurance, not explaining the period where they can't access their money without a penality, convincing them that all of their assets should be in annuities; ie "cash out everythiing you have" and not personally doing enough research to find out how the different annuities are structured so you can recommend the correct one.

When you read the senior "nightmare" stories involving annuity sales it almost always involves the agent failling to explain that their money is tied up for "X" amount of years or that it doesn't mature for "20 years" yet the senior is 82 years old. So she's start receiving checks when she's 102.

Personally I don't think the gold mind is in seniors per se. I think the gold mine is in "50ish" baby boomers who need to start transferring money from "risky" investments into safter ones. These people have a window of at least 30 years and no only need safety but also possibly life-time income. Most of these baby boomers haven't put away nearly enough money for retirement and will need some type of on-going income.

The financial brokers are all ove this group like white on rice to keep shovelling money hand over fist into the market. Not a savvy idea when you're approaching retirement age.

 

[senior-advisor-indiana]

Did you know that 90% of annuity contracts are never annuitized? Most products you can annuitize after the first year. SO i don't know why it would take 20 years to get a check. I agree that the boomer market is where the money is.

 

[Crabcake Johnny]

For some odd reason with the research I've done some agents really don't want to talk about the fact that it's life insurance. I think maybe it's more sexy if clients think it's a financial vehicle. I also think there's a stigma attached to life insurance.

But you're right - there's an infinite amount of annuity products. Right now I'm reading the lastest issue of my local insurance newletter and John Hancock has a new annuity - Venture Vision - with no surrender charges on withdrawls.

 

[senior-advisor-indiana]

THe only life insurance feature to it is the annuitization, And how it tranfers to beneficiaries. Thats not why most people buy it in the senior market.

 

[CHUMPS FROM OXFORD]

Do you think it is unethical to sell annuities to seniors?

No...not at all.

In many cases, an annuity will offer guarantees that no other product offers. As a Financial Planner, I (and I assume most others) always do a COMPLETE financial profile on the client, so you can see what assets they have, which ones are income-producing and what type of liquidity needs they will have for the next few decades.

The surrender period should never be in double digits, and the company better be rated "A" or better.

 

[senior-advisor-indiana]

I always use A rated sompanies. Did you know most banks are B rated?

 

[senior-advisor-indiana]

sompanies should be companies.....typo

 

[Crabcake Johnny]

No...not at all.

In many cases, an annuity will offer guarantees that no other product offers. As a Financial Planner, I (and I assume most others) always do a COMPLETE financial profile on the client, so you can see what assets they have, which ones are income-producing and what type of liquidity needs they will have for the next few decades.

The surrender period should never be in double digits, and the company better be rated "A" or better.

So would you say that an insurance agent with no formal financial training is ill-suited to sell annuities?

 

[johnrocks]

I think that a person should have to get more training to sell annuities AND ltc products