Colorado Bankers (CB Life)...

[Stephen Round]

I have about $17,000 in accumulated interest coming on this "5 year" annuity. If I understand it correctly, the entire amount (including the principle) is now only getting 1% interest. How much will I be able to get per month?

I have been trying to get my money out of this "investment" since 2019. Citizens Bank has been assuring me since 2019 that my money is fully insured and that I will get the entire amount . I am 71 and can't wait another 5 years to see this money. So much for our "nest egg"...

 

[scagnt83]

I have about $17,000 in accumulated interest coming on this "5 year" annuity. If I understand it correctly, the entire amount (including the principle) is now only getting 1% interest. How much will I be able to get per month?

I have been trying to get my money out of this "investment" since 2019. Citizens Bank has been assuring me since 2019 that my money is fully insured and that I will get the entire amount . I am 71 and can't wait another 5 years to see this money. So much for our "nest egg"...

Your annuity is protected (not insured) up to $500k in the state of Connecticut. That is for all annuity contracts combined.

Anything over $500k is not covered by your SGA.

At that interest payment, it sounds like you might have more than $500k in it. If so, you need to read the link I posted below. Only $500k is protected. And its not insurance, its a process that takes years to play out.

The funds are not insured. Agents are prohibited from calling it that, or using that to solicit sales.

If you have that statement in writing from the bank, take it to a lawyer and sue. They violated multiple laws by telling you that lie.

[EXTERNAL LINK] - Connecticut Life and Health Insurance Guaranty Association - Frequently Asked Questions

 

[scagnt83]

One thing that stands out to me as an agent with this mess.... so many people were sold these from banks!!

Us agents know how little training and how much sales pressure is put on bank reps. But the general public sees them as more reputable and a safer choice than an independent agent.

They assume the bank rep has lots of oversight.... the issue is the oversight they receive is to sell as much as possible and produce the most revenue possible for the bank.

Most are green to the industry and only know what the bank tells them. Im sure many are just repeating what their managers told them to repeat without even knowing it was illegal to say.

I will be shocked if a class action does not come out of this against the banks who pushed these products.

To all the consumers reading this, could you chime in and tell the forum if it was a bank you bought it through? So far, it seems that is most of the people posting if memory serves me correctly.

 

[Stephen Round]

My wife and I chose to go to go through our bank specifically BECAUSE we had been burned very badly by a "financial advisor" back in the 80's. Citizens aggressively pushed this product in the fall of 2017 with their signature green signage posted in all the local branches. I was led to believe that it was no riskier than putting our money in a CD (no risk at all).

 

[scagnt83]

My wife and I chose to go to our bank specifically BECAUSE we had been burned very badly by a "financial advisor" back in the 80's.

I understand why you would have that thinking.

Unfortunately, unless you are dealing with the HNW division of the banks investment arm, you are essentially dealing with the McDonalds of investing if using a bank.

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The financial industry today is like night and day compared to the 80s.

It sounds like you lost money on investment recommendations whos risks were not properly disclosed to you. Thats not a financial planner, or financial planning. That is a salesman who sold you stock or mutual funds.

Same with the bank, you likely dealt with a salesman, not a financial planner.
Unless you were dealing with a licensed Investment Advisor and they made this recommendation as part of a fee based financial plan.... if that is the case.... then you need to take them to mediation as they royally screwed up their fiduciary duty to you.

But most people dealing with the banks are just rolling over CD money into something with more interest. The banks chose the highest paying product... which is the easiest to sell... but also carries the most risk to the client.

My liability insurance as an agent doesnt even cover B rated insurers like CB Life because its so risky....

For 0.3% less, you likely could have had an A rated carrier that is still solvent today...

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Im sorry to hear what you are going through. Moving forward, it is completely possible to find and work with reputable financial advisors who do put your best interest first.

But you need to ask lots of questions, ask them how to verify what they say (it should be easy to do so), do a bit of research on your own, and understand that it usually comes with a price tag attached because they dont get paid commissions on the investments like the stock salesman.

 

[Allen Trent]

One thing that stands out to me as an agent with this mess.... so many people were sold these from banks!!

Us agents know how little training and how much sales pressure is put on bank reps. But the general public sees them as more reputable and a safer choice than an independent agent.

They assume the bank rep has lots of oversight.... the issue is the oversight they receive is to sell as much as possible and produce the most revenue possible for the bank.

Most are green to the industry and only know what the bank tells them. Im sure many are just repeating what their managers told them to repeat without even knowing it was illegal to say.

I will be shocked if a class action does not come out of this against the banks who pushed these products.

To all the consumers reading this, could you chime in and tell the forum if it was a bank you bought it through? So far, it seems that is most of the people posting if memory serves me correctly.

Banks also led the way in annuity sales in 2022. Record year for the industry & banks led the way

Maybe the president will bail out these customers of CBL like he did the wealthy bank clients over the weekend of Silicon Valley Bank

 

[Dan T]

Would anyone care to recommend how to roll these monthly interest payments into a tax deferred retirement account …please

 

[Stephen Round]

That was back in the day of tax credits for historical rehabs. Bad, bad,bad.
We were also told that CB Life was a "top-rated' company.

 

[Phyllis Christos]

We've been checking the website indicated on the letter every day... waiting for the BIG day....Friday March 17th.....when they said the system would be up and running... so we could make our election to withdraw accumulated interest....
As of this morning March 16th... they removed the date of March 17th as the day it would be "fixed" and now it just says we will let you know when you can use the site...
This is so unbelievably painful.
We are in a panic and becoming increasingly sick over this.

 

[scagnt83]

We were also told that CB Life was a "top-rated' company.

That was a flat out lie.

They were in the bottom 30% of all life carriers.... 30th percentile... 70% of the market has a higher rating than them.

A rating of "B" in the bond world is considered a "junk bond" meaning its extremely risky compared to other bonds. Same with insurance, but they just dont use that slang term. A carrier with a B rating is a "junk carrier" that is extremely risky compared to its peers.

As I said before, agents professional liability insurance does not even cover B rated carriers... so most true professionals refuse to sell B rated carriers.