{"id":10946,"date":"2018-05-23T15:18:18","date_gmt":"2018-05-23T15:18:18","guid":{"rendered":"https:\/\/hammerle.com\/?p=10946"},"modified":"2020-04-14T18:37:16","modified_gmt":"2020-04-14T23:37:16","slug":"annuity-fraud-when-a-good-product-goes-bad","status":"publish","type":"post","link":"https:\/\/hammerle.com\/legaltalk\/legal-talk\/annuity-fraud-when-a-good-product-goes-bad\/","title":{"rendered":"Annuity Fraud: When a Good Product Goes Bad"},"content":{"rendered":"

At its heart, an annuity is simply a type of investment that accumulates funds and then pays them out in an income stream.\u00a0 Think of it as pouring several gallons of water into a container and then turning on the spigot to let it slowly dribble out.\u00a0 Annuities are widely used for retirement, long-term care and Medicaid planning<\/a>.<\/p>\n

Annuities are also used by unscrupulous agents to scam elders<\/a>.\u00a0 Aside from being unnecessary, there can be huge downsides to annuities.<\/p>\n

The trick is to know enough to distinguish between a good annuity and an old-fashioned rip-off.<\/h2>\n

Annuities can be legally sold by a licensed life insurance agent, an insurance company, a financial planner or a broker.\u00a0 Agents and companies licensed by the Texas Department of Insurance can legally sell annuities in Texas.\u00a0 You can verify the license status by using the Agent Lookup and Company Lookup on its website<\/a>.<\/p>\n

There are two primary types of annuities.\u00a0 A deferred annuity allows you to save money and postpone paying taxes.\u00a0 An immediate annuity allows you to create an immediate income stream.<\/p>\n

Within those two types, there are several different products.\u00a0 A fixed annuity is the most conservative, and offers a guaranteed minimum interest rate.\u00a0 An equity-indexed annuity is a low- to- moderate risk; \u00a0it could earn a higher interest rate, but there is no guaranteed minimum interest rate.\u00a0 \u00a0A variable annuity is a high risk:\u00a0 it gives you choices of sub accounts for investment, but you could lose some or all of your money.<\/p>\n

To decide if an annuity is a good choice for you, ask your agent some questions:<\/h3>\n

Interest rate<\/strong>:\u00a0 What is the guaranteed minimum interest rate?\u00a0 What is the current interest rate? Is there a bonus interest rate and, if so, how do I receive it?<\/p>\n

Surrender charge<\/strong>: What is the surrender period and associated charge?<\/p>\n

Withdrawal options<\/strong>:\u00a0 Does this annuity have a withdrawal option?\u00a0 If so, what are the terms?<\/p>\n

Guaranteed Value:<\/strong>\u00a0 Does this annuity have a guaranteed value?\u00a0 Can it ever lose its value?\u00a0 Does the value reset?<\/p>\n

Death benefit<\/strong>:\u00a0 Will the annuity pay my beneficiaries anything when I die?\u00a0 How is that calculated?<\/p>\n

Annuitization date<\/strong>:\u00a0 What is this, and what is the date that it happens?\u00a0 When will I start receiving payments, and how much will I receive?<\/p>\n

Fees:<\/strong>\u00a0 What are the fees for the annuity?\u00a0 What is your commission?<\/p>\n

Funding:<\/strong>\u00a0 How do I fund it \u2013 a single payment or periodic payments?<\/p>\n

Most importantly, shop around.<\/h3>\n

There can be a big difference in the amount of commissions, premiums and benefits between companies.<\/p>\n

If you currently have an annuity, then be extra wary.\u00a0 An agent who recommends a replacement annuity may be breaking the law if his or her motivation is to earn a commission.<\/p>\n

Seniors are a favorite target for annuities scammers.\u00a0 If you are an incapacitated senior and you have been sold a bad or unnecessary annuity, contact the Texas Department of Insurance.\u00a0 You may be able to reverse the transaction.<\/p>\n

 <\/p>\n

 <\/p>\n

 <\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

At its heart, an annuity is simply a type of investment that accumulates funds and then pays them out in an income stream.\u00a0 Think of it as pouring several gallons of water into a container and then turning on the spigot to let it slowly dribble out.\u00a0 Annuities are widely used for retirement, long-term care […]<\/p>\n","protected":false},"author":5,"featured_media":11928,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_links_to":"","_links_to_target":""},"categories":[21],"tags":[1098],"class_list":{"0":"post-10946","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-legal-talk","8":"tag-legal-talk"},"yoast_head":"\nAnnuity Fraud: When a Good Product Goes Bad | Hammerle Morris Law Firm<\/title>\n<meta name=\"description\" content=\"Annuity Fraud among Senior Citizens is on the rise. 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