Consumers Should Carefully Review Annuity and Insurance Purchases from Aviva Life Insurance
ATTORNEY NEWSLETTER
Although insurance agents and companies often pitch the benefits of deferred annuities, it is important for senior citizens and other consumers to also know the risks involved in purchasing an annuity policy.
Annuity companies and their agents may engage in certain sales and marketing schemes in order to sell annuities, including “free lunch” seminars, home visits, or agents billing themselves as experts in senior financial planning. Titles such as “Certified Senior Advisor” often reflect little to no real qualifications or training.
Deferred annuities are also subject to surrender charges, which penalties that are incurred when the consumer tries to surrender the policy or make withdrawals before a certain date. The withdrawal period can be 10-15 years, making this a particularly unsuitable investment for senior citizens, and the penalties can be as high as 25%. Forfeiture charges are similar, and consumers may be offered a low interest rate in exchange for agreeing not to forfeit the policy for a certain period. Deferred annuities can also offer a death benefit when the policy holder dies, but policies may penalize heirs or the estate. Agents also often offer “teaser interest rates,” meaning a high rate of return in the first year of the policy as an enticement, only to drop to a much lower rate after that first year.
Consumers should also know that they may be paying for an agent’s bonus or commission, as well as other hidden costs. The illiquid nature of this type of investment makes it difficult for someone to withdraw funds without being severely penalized. Consumers should always carefully research any products that they are considering purchasing, and get an opinion from an independent financial advisor Aviva USA, and its parent company, Athene USA, is one of the biggest providers of annuities and life insurance products, including Indexed Universal Life insurance policies. After Aviva Life Insurance sold its US annuity and life insurance business to Athene USA in December 2012, Athene USA then sold to Accordia. Therefore, Aviva has recently sold annuity and life insurance policies in the US under the names Aviva, Athene, and Accordia.
To learn more about Aviva and its financial products, see our main Aviva page.
Evans Law Firm, Inc. handles annuity fraud and insurance fraud lawsuits, as well as other consumer fraud cases. If you purchased, or are considering purchasing, an annuity policy through Aviva, Athene, or Accordia, and want to know if it was a suitable investment for you, please contact Evans Law Firm, Inc. at 415-441-8669 or via email at info@evanslaw.com.
