I was in the middle of writing a completely different article for this week's column, and was on the Internet doing some needed research on the topic. That's when it happened: to the left of the screen, a display ad that promoted annuity returns of over 10 percent.
If you have a computer then you have seen these misleading ads, and they are so prevalent now that I have actually become numb to their constant appearance. However, when I went to a completely different site and saw another display ad from another site promoting 15 percent annual annuity returns, I had officially reached the breaking point with all of these inappropriate and non-compliant ads.
Unless you are one of the agents that are getting leads from these "too good to be true" ads and video pitches, you are probably sick and tired of answering the ridiculous questions you get from clients and prospects who are on the receiving end of these web pitches and corresponding agent follow-up meetings. Most that I run into are being pitched one annuity from one carrier. Unbelievable. This "one size fits all" problem is another issue I recently wrote about as well.
What I don't understand is why these annuity web promoters have to deceive the public from the get go. Annuities are great transfer of risk products, and can stand on their own contractual merit. Why would you ever start a client relationship with a misleading pitch? And yes, using 10 percent or 15 percent in conjunction with the word annuity is misleading. With the 10-year Treasury currently at 2 percent or less, you are probably not going to see the planets align themselves to achieve double-digit returns, especially with a fixed indexed annuity (which I find is what most annuity Internet promoters are pitching).
The solution
I was recently on a LinkedIn discussion on Sheryl J. Moore's AnnuitySpecs.com's group, and Michael Coliton posted a great idea. He said: "The first thing we need to fix is self-governance, and hold the agents and advisors accountable." Exactly. He's completely right. It's really that simple. We, as annuity agents, have to "self police" the annuity industry.
There's a ton of us that have been sitting out here watching these Internet ads and web videos in horror, and waiting for the governing bodies and carriers to do something about it. Like you, I'm tired of waiting. I think that it's time for agents to start "self policing" these non-compliant ads and contacting their state insurance organizations, national governing bodies, and specific carriers every time we see something that is obviously wrong. We, as an industry, have to protect these great products and hold agents accountable when they blatantly cross the line with their advertising practices.
