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A floor or min guarantee impresses prospects. |
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Annuity companies try to confuse issues and seems difficult for
companies to KISS...keep it simple.....thanks, Bob |
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-Being, |
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Companies should be required to promote and implement cost free 1035
exchanges to existing clients as they make changes to existing contracts
and/or initiate new products. This way the clients can always be assured
they are in the best contract for them at the time and provides reduced
chances of remaining in an inferior contract. Also, Insurance companies
are assured that they will keep the assets under management longer. |
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EIA are IMPOSSIBLE for a client to understand in any meaningful way and
the ones I have seen seem purposely designed to seriously mislead the
client about what he should expect for returns. I refuse to sell EIA
products, and the only times I have lost business to an EIA is when the
agent was clearly lying to my client. |
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EIAs are generally over-rated. There'll be more and more dissatisfied
clients if the market trend isn't upward and that is not a good bet in
the next decade. Traditional fixed annuities are much more sensible in
planning a retirement portfolio where assurances of protecting assets
are needed. In other words, there indeed is a serious question of
whether EIAs should be approached in the same way as securities, because
even though there is no downside, there may be no upside either and this
is NOT how most EIAs are being presented. Personally, I am re-evaluating
whether to include them in planning for most people, especially seniors. |
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EIA's are suitable for many, but not all clients. Agents must understand
and carefully explain all the features. |
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EIAs have been mismarketed, which is why the NASD, the SEC and other
regulatory authorities are scrutinizing these contracts. The lack of
uniform disclosure is terrible, and things will only get worse unless
the industry develops strong self-policing mechanisms. |
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EIA's should be presented as a 'safe money' alternative to both mutual
funds on the higher risk side, and CD's on the lower risk side. Too many
advisors it seems are presenting EIA's as a mutual fund clone with no
downside risk. This will only invite more scrutiny (and then rules and
regulations) from the State or Federal government. I tell EIA clients
that if they expect 5% from their CD's and 10% from their mutual funds,
then expect 7 to 8% from their EIA's. My 10 year history with the
product has validated this kind of performance expectation. And of
course, the advisor needs to be selective since all EIA's are not equal
just like all mutual funds are not equal. Helping clients make those
selections and allocations is how we as advisors add our value. |
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Emphasis should be placed on safety of principal, not ROR. |
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Everything moves in cycles: It's time will come again following the next
crash or the next deflationary slide. EIA has it's place for older,
risk adverse clients. |
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GOOD EIAs are an important financial tool. They play an important part
in many of my client portfolios. We are at the early stages of a
prolonged bear market for fixed income here in the U.S. As such,
finding safe and secure fixed income like products with acceptable
potential for yield/growth is important. A well designed EIA seems to
fit the bill perfectly. However, most EIAs, like most mutual funds and
most financial advisors -----!!! [expletive edited]. They can't beat
averages, they offer up inconsistent performance and they charge
exorbitant fees and commissions for the privilege. That said I spend a
great deal of time doing my own due diligence on any financial product
or strategy. My real concern with EIAs-- and this has been the crux of
the NASD/SEC review -- is that most EIAs are being sold by incompetent
Life Insurance salesman who use these products almost exclusively.
Because they lack knowledge (or maybe moral fiber) they are tearing up
the avenue behind them; they are ruining this product for the rest of us
who actually know what we are doing and understand that an EIA can not
solve all the problems that ail you. Of course the NASD and SEC are
getting annoyed; near $30 Billion in sales this year alone. No due
diligence. No oversight. No professional licensing. The NASD and SEC
are being forced into action because insurance companies are not
overseeing the sales of their own product. If they were û the NASD and
SEC would be silenced. My firm has gone so far as to simply ban the
sale of any EIA until further notice. Well done fellas. Thanks! |
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good product if sold right and the potential is not oversold |
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I am not sure I am comfortable with EIA's. |
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I attended a educational seminar presented by a large financial
brokerage firm that was going to reveal the in's & out's (the working
part's of EIA's). What was presented was a seminar on how to defeat
EIA's by comparing them with VA's & performance! EIA's are a fixed
annuity & can be used in the right situations to provide more income
than other fixed investments. They are not intended to compete with the
performance of variable annuities & other variable investments. In stead
of comparing apples to oranges, why don't they improve their products
and not offer benefit guarantees that cost more in additional fees then
they actually provide in benefit to the client. |
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I currently do not recommend EIAs nad will not until the
caps/participation rates increase and commissions decrease so that thye
are a better deal for clients. |
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I do not use any particular FMO as the product(s) I currently use the
most often are Lafeyette Life and ING |
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I feel very strongly that the EIA product is well suited for the ultra
conservative investor, i.e. the fixed annuity/CD investor. This may
extend to the investor who then wants just a bit of a gamble without the
risk of loss of principal. That said, EIA's are a wonderful tool, as are
so many financial products, if used correctly. |
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I find that many FMOs and.or brokers will push an EIA becaus eof te
comission ratrher than what it will do for the consumer. That bothers
me. |
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I just wish that the NASD would leave this product alone! |
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I know now that not all EIA's are created equal and many of the
marketing organizations don't care to let you know that. |
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I like MCP. I wish you included more annuities and historical,
hypothetical returns. |
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I need EIA with 100% participation, bonus of 10% and no cap and less
margins. |
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I need then NASD to recall 05-50 because my broker Raymond James is
trying to make us do this business inhouse on Jan 1st, and they don't
like most of the EIA's including Allianz, and don't have any strategy to
build my business. |
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I prefer having multiple interest crediting formulas within the EIA |
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I see many EIA being mis-represented by agents. The whole story is not
told to the client. Probably, because the agent themselves do not
understand how a EIA works. The other thing I see, is agents that are
not security licensed, telling clients to liquidate thier Mutual funds
or Vasriable Annuities, this is a violation of NASD/SEC rules, but the
don't seem to care and the FMO's & Marketing Companies are playing done
this area. On some of the material/brochures I have seen, the FMO's or
Marketing Groups play up the tax advantages of the EIA without telling
the clients that a fixed or varialbe annuity has the same tax
advantage. I think there is a lack of disclosures that will come back
and bit the producer and possible the FMO's & Marketing Groups |
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I think that these questions are slanted to make EIA's look better than
they are. I think that the issue at hand is not simply the performance
of EIA's but rather, the rampant mis-use , predatory tactics, and
misrepresentation that many agents are using in the market. |
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I want to know which contract best suit the client. |
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I would really like to see demo software - I have looked into purchasing
your software - however, I always like to test drive a car before I buy
it. I would consider allowing prospects test your software for 14 day
or so to see if it meets their individual needs --- remember benefits
sell --- feature and advantage only spark interest -- I am interested
but not compelled to buy your software until I can try it. |
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In a year when the index goes through the roof and the client hit his
cap, the company should share the windfall and credit more interest to
that pot based on the huge upward spike of that index. This is one of
the negative things I hear from clients about EIA's. They love the fact
that it will not go down in a down market, but they resent the idea of
getting 7-9% when the index they are in goes up 15-20%. They look at
this as the companies being big profit taking pigs. |
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It is NOT a security! It is NOT complicated. If Ins. Co.s & reps wd
just tell the truth, none of the hoopla that exists w/NASD would exist.
Hey, how 'bout full disclosure on bank CD's? |
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It;s a fixed annuity, nothing more, nothing less. |
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Just concerned about the NASD inquiry and how it will affect the
industry. |
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keep the good ideas coming |
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Like Variable annuities it is difficult to determine how well companys
perform over a time period. |
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Many EIA's have so many moving parts that what we explain today may not
be true in the years before maturity. |
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Most FMO's have no clue as to the potential returns of EIA's and mislead
advisors in their recommendations. This comes from 'lack' of knowledge
AND 'lack' of reseach.. |
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Most produce a fraction of the index return and are not nearly as good
an investment as the sales material would lead you to believe |
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not all EIAs are created equal |
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Not really, however I'm glad that EIA's are being looked at by the SEC/NASD.
Maybe it will finally cut down on the deceptions and 'one-size fits all'
sales approach used by the insurance industry and its sales people to
bilk seniors into converting their life savings into agents commissions! |
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Offer peace of mind and guarantees not rate and term. |
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Our clients only want to know that they will never lose another dollar. |
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our compliance dept is really uncomfortable with us selling these now
with the SEC looking at them. We do need better comparisons on what we
are selling and the returns vs the index it is tied to. |
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returns are only part of the picture - caps are important too. My
customers like the EIA concept but would like to have better performance
in strong markets. If we get a 30% market and they are capped at 8% I'm
going to have a disgruntled customer. |
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Returns are secondary when used properly. Preservation of principle is
primary. These retirees may not have time left to recover losses in
their principle. Running out of money is of great concern to most of
them!!! |
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Returns are useful if properly illustrated. The comparisons with actual
index returns does not show the actual returns of the indices less the
impact of dividends. As a result comparasions are not really accurate.
These are great products if sold to fulfill clients' objectives. |
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SIMPLIFY AND DO NOT MAKE PRODUCT TO CHEAT CLIENTS.NO IF'S AND BUTS. THAT
IS WHY PEOPLE PREFER CD'S. |
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Some companies show illustration of historic returns useing
'hypothetical' s&P values only. Seems to me they should also use
'actual' S&P values along with the hypothetical values. |
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the crediting rate is by far the most important facet of an EIA. No
one, not issuers, advisors or marketing groups, provides enough detail
on how these methods work. When looking at historical returns, there
are HUGE differences in the actual EIA returns based on the crediting
method used. because of the lack of information, I am forced to do my
own analysis to figure out which method works best in different market
environments. |
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The rate needs to be higher than a bank C D. |
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we should return to 'true' fixed annuities and forget these products. If
I had a good 5% fixed annuity I could sell the heck out of them. |
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While the FMO's I use are in general good at what they do, it doesn't
seem realistic to me to expect them to be unbiased in their
recommendations since they have to satisfy so many carriers with varying
product portfolios as well as so many agents with different personal
agendas. In particular, I will not use any FMO that is even partially
owned by Allianz. I have found that I can dismiss the vast majority of
indexed products on the market today because of excessive surrender
charge periods and the surrender charge percentages themselves. I think
anything beyond 10 years is almost certainly to be to the detriment of
the client |
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wish it were easier to get accurate information on how a specific EIA (I
like to just call them Indexed Annuities and leave equity out of it)
would perform under different types of market conditions |
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With all the potential moving parts(i.e., guarantee on 87.5% of total
premium, current cap, and minimum cap, participation rate, etc) on a EIA
it's very difficult to assess which product offers the best guarantee
and potential return to a client, and what is likely to actually occur. |
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Yes. It took a 10 credit continuing education course on line to get me
up to speed really on EIA's. And that material was pretty difficult.
Most of the materials I have seen make it very difficult for the client
to understand what's really going on in an EIA. |
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You should have a 'somewhat agree/disagree' in question 3. Ratings are
important, but a lot of good returns come from companies that are B+ or
B++ that are stable companies. |
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your software is very helpful. |
