InvestmentNews.com reports that perks distract annuity salespeople from focusing on what’s best for their clients. This is in line with recent and not-so-recent criticism of annuities as hopelessly complicated investment products that often benefit brokers and insurance companies more than investors:
“Vacations at luxury resorts, golf outings, tickets to sporting events and other incentives have led to inappropriate sales of annuities, Sen. Elizabeth Warren, D-Mass., claimed in a study released Tuesday.
“In a survey of 15 firms, Ms. Warren’s staff found 13 offered non-cash inducements to their agents to sell their annuities, which guarantee income but often are complicated, are known for having high fees, and can tie up large chunks of a client’s money.
“Disclosure requirements surrounding the perks are inadequate and usually buried in lengthy prospectuses, leaving investors vulnerable to sales professionals who are trying to win an award rather than find the best investment products for their clients, according to the report.”
Read the entire InvestmentNews article here.