Annuity Products – Negotiating A Surrender

October 31, 2022 by Burt Snover

There are many opinions among financial industry professionals on why annuity surrender charges exist, how they may be a good thing, and how they may actually enhance product designs. On the flip side, many cynics believe they exist to further gouge a client, or that they represent an additional profit center for the carrier. It may help to view all of those opinions through the lens of the simple truth stated above. Surrender charges result from the necessity of up-front commissions and the amortization of other acquisition costs.

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Wink’s Note: What about fee-based annuities that have a surrender charge? You might be surprised. – sjm

Originally Posted at LinkedIn on October 28, 2022 by Burt Snover.