The Government Doesn’t Want our Prospects to Know About Annuity Insurance.why?
In this day and age where the financial markets are in disarray and the future of so many people’s money is in doubt why would the government want to make it a rule (a punishable offense) to not allow the industry to inform potential customers of a safety net?
How can this make any sense?
Our banking institutions have a safety net. It is called the FDIC and it is proudly displayed on fixtures, front doors, desks, tables, stationary, and websites. Anyone who does business with a bank knows what the FDIC stands for it stands for security guarantees and insurance protection. It creates peace of mind and allows depositors in the banking industry to be free of fear. The underlying guarantee is backed by the full faith and credit of the United States Government. Your funds are guaranteed and will always be safe.
How about Credit Unions?
This protection was established by Congress in 1970 to insure member share accounts at federally insured credit unions. All federally insured credit unions proudly proclaim this insurance and make certain you know that your funds are safe. Guarantees, safety, and security is their mantra and they want you to be aware of it.
How about stock brokerage accounts?
What insurance is available to their investors? The protection in place is called Securities Investor Protection Corporation which was created by Congress in 1971 to ensure that any brokerage house that would become insolvent due to regulatory issues or bankruptcy would protect investors from missing assets such as securities.
Without SIPC an investor could possibly lose their securities or money or be tied up in lengthy court actions. The letters are promptly displayed on all participating Securities Firms on their doors, furniture, and on most correspondence. This insurance gives the investor peace of mind regarding access and availability to their funds and assets.
How about insurance companies?
Life insurance and annuity products? It seems the government does not want you to know about their guarantees and the question is why? Why don’t they want the consuming public to know about this “secret security net?” This guarantee is in place to help and assist policy owners in the event of insolvency of an insurance company to provide funding and liquidity. Coverage and protection are generally for individual policies and the limits of protection will vary from state to state.
Here is the unbelievable part: most states will not allow an insurance agent to tell their prospects about this underlying guarantee until AFTER they have decided to purchase the insurance product. Insurance agents are not allowed to post the guarantee on their doors, furniture, or correspondence. Advertising is strictly prohibited and yet the question still remains Why?
Banks, credit unions, and stock brokerage firms can all advertise, discuss, display, and market their guarantees, yet insurance agents and companies are prohibited. Insurance agents must never use this information to induce a sale and yet who would ever make a deposit in a bank without asking about FDIC?
The question remains still unanswered. Why is this guarantee not being made available to people who are considering an insurance product? How can banks and other institutions advertise this guarantee and not insurance agents?
In this time of great financial stress would it not be comforting for a prospect to know about this safety net? The protection along with the great contractual guarantees would make them more likely to buy an insurance product and a bank product; it seems that way to me anyway.
