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Follow-up to the Great Annuity Rip-Off
By JLP | February 7, 2007
The January issue of Kiplinger’s Personal Finance had a pretty good article titled The Great Annuity Rip-Off. I posted about the article back in December.
Anyhow, I was thumbing through the March issue of Kiplinger’s when I found this letter to the editor by Frank Keating, President and CEO of American Council of Life Insurers:
“No one is more disturbed by accounts of inappropriate sales than the annuity industry. Life insurers, the manufacturers of annuities, are committed to ensuring that consumers know exactly what they are getting when they purchase annuities. That is why the industry is working with regulators on new disclosure documents. Although not for everyone, lifetime-income guarantees from annuities can provide many retirees with peace of mind. They should have the same peace of mind about the people who recommend the annuities.”
I find this hard to believe. I mean if the industry is so disturbed by inappropriate sales, why do they allow companies to produce products that are crap?
Also, how hard is it to come up with a system that shows customers EXACTLY how much they are paying for their annuity? It’s not hard. The reason it’s not done is that most potential clients would run straight for the door if the salesperson was truly honest about the product.
Topics: Basics, Financial Planning |