If you own an annuity, you own one of the highest commission products sold to retail investors. Odds are that your purchase was in the context of planning for your financial future. You probably asked the salesperson for advice about saving for your financial goals. Despite his efforts, you asked the wrong person.
This is a harsh assessment, but it’s not our opinion. It is the description that the National Fixed Annuity Association used to describe the annuity sales people that they represent. NAFA is a lobbying group that is desperate to exclude fixed annuities from the oversight of the Department of Labor’s Fiduciary Rules. In November, NAFA filed a lawsuit to halt enforcement of fiduciary regulations. The suit complains that the fiduciary rule is expensive for annuity companies to enforce. They sell expensive, illiquid policies to consumers and are complaining about costs? They also complain that fiduciary rule favor investment firms.
Wrong. The fiduciary rule FAVORS CONSUMERS.
The words that NAFA uses to describe annuity salespeople are embarrassingly frank. NAFA says that their salespeople lack trust and confidence. They insist that the public implicitly understands that annuity sales agents can’t be trusted to give advice and that they only sell products. They are relying on this admission of inadequacy to win their lawsuit against the Department of Labor.
We have friends that work in the insurance industry. They are hard-working members of our industry. This isn’t an indictment of any salesperson’s character or honesty. They sell what they are paid to sell, which isn’t illegal. NAFA admits to the limitations that financial product sales people face. They cannot provide in-depth, meaningful advice to investors and savers. They provide products. That’s it.
NAFA contrasts the inability of annuity salespeople to give advice with fiduciary advisors who, “have a relationship of trust and confidence with their clients.” If you bought an annuity in the last few years, did you know that you were dealing with someone that even their own national organization calls untrustworthy at providing advice? It’s there in black and white (and orange). If you are seeking advice from a firm that will act in your best interest, in all matters, at all times, call LeConte. We proudly proclaim our fiduciary standard of care.