Index Annuities

[Franz Kafka]

IMHO the average investor/broker/advisor still hasn't grasped the fact that the stockmarket as we have known for the last 2 1/2 decades has now disappeared. The market has entered the new long term cycle since the 2008 crash. The "new volatility" of it will break everyone except the most astute traders. All the security guys have been warned. JMO

 

[scagnt83]

Good point! I just figured I would start it off with a BANG! My apologies if I offended anyone. My zeal based on this client got the best of me.

KJ. In all fairness you were exposed to (imo) one of the worst IA companies on the market. They have notoriously complex contracts and crediting methods.

My grandmother had an Alliance annuity and it was horrible.


But just like any product, there are good ones and bad ones.

Also, the choices the client or agent make within that product can affect it greatly; especially in the more complex contracts.


Its your duty to find the good ones and stay away from the bad ones.


You asked me to prove to you that your statements are factually wrong... I have neither the time or desire to do so line by line.

But an example of a good contract would be the Lincoln New Directions 8 IA. (rates suck right now though)

First, it has a 2% guaranteed minimum yearly crediting rate if the indexed values are not positive; and that 2% guarantee is on 100% of your money.

Then it has a "performance triggered" indexed account.
That means that if the index is equal to, or greater than the start of the year you get the specified crediting rate (currently 5%; I remember it being 8% & 9%)

It also has a two year p2p w/ cap.
That means that anything positive for the two years, up to the cap (currently 12%), is credited to the policy.



This contract is a far cry from the Allianz policy you saw.

 

[arnguy]

Scagent, did your grandmother have an Alliance annuity or an Allianz annuity, please clarify?

 

[scagnt83]

Scagent, did your grandmother have an Alliance annuity or an Allianz annuity, please clarify?

lol, you got me; Allianz. It was the BonusDex10.


I have looked at Allianz multiple times and thought about it a lot; its just not a line of products and a company that I can get comfortable with.... I wouldnt own one, so why would I recommend one?


They are stepping up their game in the VA world; but they still cant match Pru/JN/Met

 

[BNTRS]

Didn't this guy say that he replaced on of these IA's with some other product? What was the other product? What made it so much better?

 

[bcoughlin]

I wrote a bunch of Americo 7 year policies in 2003. All of them returned between 47-52% over the 7 years. These were monthly average 7-10% caps over the 7 years. I will take a 7% avg with no risk any day. I think the market returned about 3% avg during that time.

I am not a big fan of monthly cap as a number of times the market is higher yet volatility wiped out the gain.

 

[KJ in Miami]

KJ. In all fairness you were exposed to (imo) one of the worst IA companies on the market. They have notoriously complex contracts and crediting methods.

My grandmother had an Alliance annuity and it was horrible.


But just like any product, there are good ones and bad ones.

Also, the choices the client or agent make within that product can affect it greatly; especially in the more complex contracts.


Its your duty to find the good ones and stay away from the bad ones.


You asked me to prove to you that your statements are factually wrong... I have neither the time or desire to do so line by line.

But an example of a good contract would be the Lincoln New Directions 8 IA. (rates suck right now though)

First, it has a 2% guaranteed minimum yearly crediting rate if the indexed values are not positive; and that 2% guarantee is on 100% of your money.

Then it has a "performance triggered" indexed account.
That means that if the index is equal to, or greater than the start of the year you get the specified crediting rate (currently 5%; I remember it being 8% & 9%)

It also has a two year p2p w/ cap.
That means that anything positive for the two years, up to the cap (currently 12%), is credited to the policy.



This contract is a far cry from the Allianz policy you saw.

Thanks for clarifying!!!

 

[jacobtn]

Not hypothetical.
- - - - - - - - - - - - - - - - - -

How can you say that they are not invested in the s&p? What does Allianz tell you that they are invested into? To me, that arguement does not even hold water. So they mirror the s&p; however, when the s&p makes 11% Allianz does not? How? Is Madoff involved? Too good to be true I would say! It is invested in something... once again - Allianz cannot pay high commission (although they do not anymore) without making $$$. In reality that just does not work.

I never even conseidered the dividends.

You are clearly an ***, and I'm not going to respond to everything, but if you actually READ the Allianz material, it clearly says "NOT INVESTED IN ANY STOCK OR INDEX".