Questioned for Registered Reps?

[0b1kanobee]

I would like to eventually get my 66 or 7. I had my biggest case ever recently (little over a million dollars) and about 60% of the money went into a V/A. After watching that part of the presentation from my partner and how a V/A can be a perfect fit for some people, I want that in my bag.

I have been brain washed (feels that way) on how BAD V/As are but with the right client, they are a beautiful thing.

Funny thing is I got the lead from a health insurance agent I work with who was talking to the client about a vision plan or something. I have him specifically ask folks about their retirement accounts and then I call to try and set up an appointment.

 

[sman]

I would like to eventually get my 66 or 7. I had my biggest case ever recently (little over a million dollars) and about 60% of the money went into a V/A. After watching that part of the presentation from my partner and how a V/A can be a perfect fit for some people, I want that in my bag.

I have been brain washed (feels that way) on how BAD V/As are but with the right client, they are a beautiful thing.

That's why I have tried to remain open to all products. I always want to learn the pros and cons of any product and see how it could possibly be a fit for any potential client. I use VA's specifically for risk management. If a client likes the idea of investing in the market and wants a guarantee on income, VA's can be a great tool. Additionally, there are several available with 3-4 year surrender charges. If there's one thing I struggle with on index annuities is the longer surrender periods. However, I remain open to using them in the right situation. I'm just not a fan of 10 & 12 year surrender periods. That's a personal issue though.

By remaining securities licensed, I can offer either solution to the client. Of course, if I were only doing a small amount of GDC each year it certainly wouldn't be worthwhile to put up with the hassles of any BD. Fortunately, my BD is fairly adviser friendly.

I realize there are some who focus on just index annuities and I have no problem with that if sold properly (or at least my definition of properly ).

 

[DHK]

I would like to eventually get my 66 or 7. I had my biggest case ever recently (little over a million dollars) and about 60% of the money went into a V/A. After watching that part of the presentation from my partner and how a V/A can be a perfect fit for some people, I want that in my bag.

I have been brain washed (feels that way) on how BAD V/As are but with the right client, they are a beautiful thing.

Funny thing is I got the lead from a health insurance agent I work with who was talking to the client about a vision plan or something. I have him specifically ask folks about their retirement accounts and then I call to try and set up an appointment.

I can understand how you feel. Let me help with the "de-ignorification" process:

1) The guarantee is a "phantom" guarantee. You can't take it out and move it to another company. It's only as good as the company it's with. Every other type of annuity offers a cash return guarantee - where you can take out all the money at the end of the annuity's deferred accumulation period.

2) Once your VA is severely under-water from the guarantee, you CANNOT move the annuity to another one. Otherwise, the client gives up their "phantom guarantee". They get locked in, and you can't get paid again to service the VA.

Fixed annuities always gain. Fixed Index Annuities can still be moved after their term is up. VAs? Depends on the performance. I like knowing that you can always move the cash to a new contract that may have more and better features.

 

[Newby]

I had a final expense appointment this week and the prospect wanted me to call his "financial advisor" to explain to her why he needs the small life policy. He is just single paying but she doesn't want him to pull anything out of her investment.
When I called her she explained that she has his money in a Prudential variable annuity that is guaranties to grow 8% minimum every year. Many years it pays 20% or more.
I plays stupid and said "really? Why doesn't everyone buy these?"
She smells blood and starts pitching me with a whole lot of BS.
I said "so I can put in $200,000 and leave it in for 10 years until I'm 60 and then pull it all out and do anything I want with it and I will have a minimum of $200,000 plus 8% compounding intrest per year after all the fees and everything?
She said "yes but you will really have a whole lot more than that because 8% is the bare minimum and it only goes that low if the stock market goes down."
The client totally trusts her and has 100% of his retirement with her. She is a retired school teacher and is selling this to everyone at her church.
He is going against her wishes and buying my policy though.

 

[VolAgent]

Wow, either some pure ignorance or brazen misrepresentation going on there. Too bad you didn't record that. Get the prospect to ask for all the money out and see how that went.

That is the thing about VAs, the guarantee is just phantom money, it doesn't really exist. They are great for producing income, but woe to the person who needs access to the principal.

Also, anyone who thinks they are going to be able to roll VA with living benefit riders is fooling themselves. Unless you catch it on just the right day, it will almost always be underwater.

 

[xrac]

Wow, either some pure ignorance or brazen misrepresentation going on there. Too bad you didn't record that. Get the prospect to ask for all the money out and see how that went.

That is the thing about VAs, the guarantee is just phantom money, it doesn't really exist. They are great for producing income, but woe to the person who needs access to the principal.

Also, anyone who thinks they are going to be able to roll VA with living benefit riders is fooling themselves. Unless you catch it on just the right day, it will almost always be underwater.

My money is on ignorant. Many of the people in this business are. Most of us wind up selling stuff we don't understand because of what our superiors tell us. It is only after we learn a little that we begin to get the truth.

 

[Newby]

I'm pretty sure she doesn't understand a thing about what she is selling.
She also told me that the very day he dies, she can call Prudential and the will wire the entire amount directly to his son (the beneficiary). No death certificate needed. They will just go off of her word because she is an "area manager".
In Kentucky it takes at least 30 days to get death certificates.
I made the point that prudential's life insurance won't settle without a certified death certificate so why does she think the annuity will. She is certain it will because the people need the money so Prudential will just do it for them. She did admit she has never had any clients die yet.
It's amazing what people say to try to make sales.

 

[VolAgent]

I'm pretty sure she doesn't understand a thing about what she is selling.
She also told me that the very day he dies, she can call Prudential and the will wire the entire amount directly to his son (the beneficiary). No death certificate needed. They will just go off of her word because she is an "area manager".
In Kentucky it takes at least 30 days to get death certificates.
I made the point that prudential's life insurance won't settle without a certified death certificate so why does she think the annuity will. She is certain it will because the people need the money so Prudential will just do it for them. She did admit she has never had any clients die yet.
It's amazing what people say to try to make sales.

She may be ignorant about how the GWLB rider works, I'm guessing its a GWLB. But the part about the death certificate she is just making up to get sales. Someone needs to stop her now before she really hurts someone.

 

[Guest]

Also, anyone who thinks they are going to be able to roll VA with living benefit riders is fooling themselves. Unless you catch it on just the right day, it will almost always be underwater.

I have a three different securities licensed professionals who handle various investments... each has a different "specialty" or "orientation" if you will... one is a stock-bond gal, one is a funds guy and the third preaches limited partnerships and more esoteric types of investments for people with assets.

My funds gay is always telling me about the "new" VAs and how terrific they are... especially one by Met. Well, the frickin' prospectus (yeah, I read them... I really do) is like 500 pages. [editorial]My feeling is that IF it takes a small book to explain and disclose a financial product it is "all FOR" the company and NOT "in the interest" of the client!!! [/editorial]

Can you explain in a couple of paragraphs for the compete *** why these new VAs are really "blue smoke and mirrors." I don't have one, don't plan to have one, but I'd like to know the major downsides of these new products so that I can "ask quesitons" to people who DO have them. Legally we agents can't really "talk" about VAs... but we can say "You should ask your broker about ...... and listen to what she says and let me know."


Thanks.

 

[Crabcake Johnny]

That your funds guy is gay seems irrelevant Al.