11% Surrender Charge

[jmhalvo]

If you are licensed with the 7, If she is deadset on it, surrender it and open a brokerage account up. Once you are there, you can open your options up.

whereupon your b/d compliance automatic questions will immediately be: what is the $ source? Was there a surrender charge? There is no way to help this prospect except to advise her to avoid surrender charges. If she wants a lawyer etc that's her deal. There is not a new client here. Period.

 

[LauderdaleBAUS]

Nope. Don't even THINK about it.

How can you defend this as an UNSOLICITED transaction (surrendering the annuity)... when you open a brokerage account where you would CLEARLY benefit from any trades placed within it???

If you have a securities license, you'd have an IMPOSSIBLE time defending this transaction.

However, if you have a compliance officer, explain the situation to them and get their feedback. Most would rather help you AVOID a sticky situation than to have to defend or investigate anything after the fact.

LauderdaleBAUS has clearly never been securities licensed for giving such a stupid post such as he did.

LOL OK, I have turned down $1.5 million dollar cases from clients wanting to switch from M.Lynch because the agent had them in toxic assets that I didn't wanna be responsible for and referred them to litigation. There is only one answer to this guys question and its no she can't do anything. She is screwed.

 

[Experienced Agent]

LOL OK, I have turned down $1.5 million dollar cases from clients wanting to switch from M.Lynch because the agent had them in toxic assets that I didn't wanna be responsible for and referred them to litigation. There is only one answer to this guys question and its no she can't do anything. She is screwed.

Informed her today that her best course of action is to take no action. She's headed to the bank. I suppose they'll have no problem with it???

 

[DHK]

Bankers and managers typically don't have licenses.

Those that do... have compliance officers.

Let them deal with it. At least your name is no where to be seen on anything.

Google "Glenn Neasham" and compare your situation. The difference you have... is you didn't sell anything, and it may not appear that your client has any mental impairments. But you and your licenses should survive to sell another day.

An "overly concerned banker" was the one that thought some kind of "financial elder abuse" was going on and caused a huge uproar, lawsuit, and criminal conviction (that was finally overturned).

Better to avoid it and keep your own name out of it.

 

[jacobtn]

I was referred to a client regarding her displeasure with her Phoenix annuity (IRA). It has an income rider that charges her a significant fee. She petitioned Phoenix to drop the rider, they will not. Her main contention is that she was not aware of the charges and she is a woman of principal, regardless of what may be best for her. She has had the annuity two years with an 11% surrender charge.

My question is whether another company will accept a rollover of this annuity. Perhaps Allianz 222 with 15% bonus. Would suitability prevent this transaction? She does have plenty of liquidity, an amount equal to her annuity in a bank savings account.

She is 74, not sure what other info would be necessary to help. I realize the only definitive answer would be to actually submit the contract and wait for underwriting review. I'm trying to get an opinion so as to save the time and effort of the whole application/underwriting process. Any thoughts are appreciated.

I would AOR the contract so you can possibly assist her or the bennies down the road, but wouldn't replace the contract for the reasons others have stated.

Also I find it hard to believe she can't drop a fee based rider? Didn't realize Phoenix wouldn't allow that.

 

[DHK]

Since it's a variable annuity, you can't be AOR/BOR without being with a B/D.

He can't service it.

 

[AnonymousOne]

Unless I missed it. There is no reason to believe this is a va

 

[DHK]

You could be right. Just saw this on their website:

Variable Products not available for new sales.

https://www.phoenixwm.phl.com/public/products/annuity/portfolio/index.jsp

 

[Klutch]

Since it's a variable annuity, you can't be AOR/BOR without being with a B/D.

He can't service it.

I picked up that AOR = Agent of Record, what about BOR and B/D?

 

[AnonymousOne]

Broker of record, broker/ dealer. Variable side of business.