Adding to the confusion is the suggestion that income annuities have “often-high fees,” when in fact they have none.

November 30, 2023 by Sheryl J. Moore

This article from Aaron Brown at Bloomberg News, which was featured in ADVISOR PERSPECTIVES INC, is extremely misleading.

To start- insurance companies with private equity backing hold 26.6% of the deferred annuity market; not 10%.

The beginning of the article outlines the current goings-on in the deferred annuity industry but then points to income annuities.

To be clear- income annuities, which definitely are not of the “most interest to individual investors,” account for a mere 4.8% of all annuity sales.

Deferred annuities, by far the more popular variety of annuities, DO pay the full account value upon the annuitant’s death.

Adding to the confusion is the suggestion that income annuities have “often-high fees,” when in fact they have none.

The suggestion of a “run on the banks” for insurance companies fails to account for surrender penalties and market value adjustments. Further irritation that there is no mention of the NATIONAL ORGANIZATION OF LIFE AND HEALTH INSURANCE GUARANTY ASSOCIATIONS, in such a discussion…

I would chalk this article up as entirely useless, to be honest. It’s a shame that consumers are misled by pieces like this, under the guise of “reputable news.” – sjm