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November 21, 2011

Misleading Annuity Advertisement "Find Security 9.62% Cash Flow"

by John Darer CLU ChFC MSSC RSP CLTC

Yield starved savers could receive an advertisement like the one I just received.  The 9.62% is NOT a rate of return. It represents a mathematical calculation that measures the annual income over the cost of the annuity. What is misleading is the omission that an annuity payment includes principal as well as interest.

It's easy to see how unsophisticated consumers, including seniors, could be misled by the advertising.

While the advertisement states that it is "not to be used with the general public", who are we kidding? Attempting to set insurance agents (whose names you bought off a list) up to verbally misinform the public is despicable. There are enough benefits in annuities to not have to resort to such tactics.

Posted at 12:46 PM in Annuity Bad Sales Practices, Annuity News |

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Structured Settlement Best Practices Corner

  • New York Insurance Advertising law requires the full name of the Insurer to be listed along with the city and state of the principal office. Stating that you represent these fine companies using Insurance company logos without the preceding information are also illegal
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  • Most states require that Testimonials represent the CURRENT opinion of the person who made the testimonial. Be prepared to back it up.
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