Annuities and the Elderly
The North American Securities Administrators Association, an association of state regulators, reports that over one-third of all cases of financial exploitation of the elderly involve annuities. Hundreds of class actions have been filed against insurers over annuity sales to the elderly, including one in Minnesota against Allianz for nearly 400,000 plaintiffs.
Index based annuities are not regulated by the NASD, so there is no federal oversight over their sale. This allows companies to use agents to push inappropriate products without any immediate regulatory oversight The wholesalers will frequently pay for and provide marketing for the original meeting for an agent. Commissions are unusually high 10-15% verses 5% for the rest of of the industry and there is no reasonable investment objective for elderly to purchase these products. The longer the surrender period, the higher the commission.
Our firm is currently representing clients in the sales of annuities to the elderly by Midland National Life Insurance Company. All federal cases have been consolidated into an MDL for national discovery.
For further information about your rights against agents and companies that sell these investments, please contact us.
