Curious to know if my understanding of FIA trail commissions is correct (I believe it to be correct, but someone said something recently that made me wonder if I'm confused).
It's my understanding that as long as the contract is in-force, and NOT annuitized, trails continue to be paid. In other words, just because the contract is out of surrender, the trails still get paid if it's in force. Also, just because lifetime withdrawals are being taken from the contract (in the form of an income rider), that doesn't matter either, trails continue to be paid.
If a contract is surrendered, the agent of record is changed, or the if the contract is actually annuitized, the trails will stop.
This has always been my understanding, am I wrong?
Note: I'm talking for Allianz, ING, Lincoln Financial contracts. I know some companies, like GAFRI, continue trails to writing agents only, but that aside...
So for example: Client has a Masterdex X contract for 12 years (out of surrender). Contract value is $100K. Income base is $150K. Client is 65 years old. Client is taking $7,500 per year in income. In this example, trails WILL continue to be paid to the agent, correct? They would only stop upon surrender, change of agent, or annuitization (which, income rider withdrawals do not count for).
Thanks in advance!
It's my understanding that as long as the contract is in-force, and NOT annuitized, trails continue to be paid. In other words, just because the contract is out of surrender, the trails still get paid if it's in force. Also, just because lifetime withdrawals are being taken from the contract (in the form of an income rider), that doesn't matter either, trails continue to be paid.
If a contract is surrendered, the agent of record is changed, or the if the contract is actually annuitized, the trails will stop.
This has always been my understanding, am I wrong?
Note: I'm talking for Allianz, ING, Lincoln Financial contracts. I know some companies, like GAFRI, continue trails to writing agents only, but that aside...
So for example: Client has a Masterdex X contract for 12 years (out of surrender). Contract value is $100K. Income base is $150K. Client is 65 years old. Client is taking $7,500 per year in income. In this example, trails WILL continue to be paid to the agent, correct? They would only stop upon surrender, change of agent, or annuitization (which, income rider withdrawals do not count for).
Thanks in advance!
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