LPL assures advisors other VA issuers won’t copy Ohio National
January 29, 2019 by Tobias Salinger
A major variable annuity issuer’s move to cut off trailing commissions for advisors in certain contracts won’t be repeated — as far as the nation’s largest independent broker-dealer is concerned.
The 15 VA carriers who have selling agreements with LPL Financial have pledged to pay advisors their agreed-upon commissions, Rob Pettman, LPL’s executive vice president for product and platform management, said in a Jan. 24 message to the firm’s more than 16,000 advisors. Ohio National Financial Services stopped paying the trails on Dec. 12 for variable contracts with a guaranteed minimum income benefit rider.
“To ensure your trail commissions are contractually protected, we recently partnered with our variable annuity carriers to reaffirm their commitment to compensating you,” Pettman said in the email blast. “Your confidence in these carriers is important to us so you can maintain your focus on doing what you do best, which is taking care of your clients.”
He cited “unfortunate business decisions” by the Cincinnati-based insurance firm — which raked in more than $1 billion in total annuity sales in 2017 but stopped writing new annuity contracts in September. Ohio National’s decision to stop the trails prompted LPL to focus on “protecting the important revenue streams you’ve built from variable annuity business,” Pettman said.
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