Newer to Insurance, Questions About Annuities

[insuranceguy1357]

I got into selling Medicare products a few years ago because I was looking for a new challenge and of course wanted to earn extra income. It has been a real blast meeting with Seniors and helping them find a plan. I am a captive agent with UHC (I know some people love UHC captive on here and some hate it, but it works for me because I already have a job and I can work the leads that are sent to me).

Things do slow down during SEP and I would like to branch out. Some agents I know also sell life. I haven't yet met any that sell annuities. I was wondering if there were life insurance or annuities companies that have something similar to the UHC ICA program? If so, which route would be recommended? I am leaning towards life but I have heard some good things about annuities residuals.

Any thoughts would be greatly appreciated. Thanks

 

[DHK]

Your post reminded me of this thread, so I'll just post this here:

http://www.insurance-forums.net/forum/annuities-forum/beginner-help-appreciated-t81685.html


Annuities have almost no renewal commissions. However, should the DOL ruling still go through (I think President Trump will strike it down), there will be more companies that will be offering reduced up front compensation and an ongoing renewal trail commission.

----------

Oh, and I have no idea what the UHC ICA program is, so I cannot make any comparisons.

 

[insuranceguy1357]

Thank you very much. The UHC ICA program makes you a captive agent for Medicare Advantage (But not for Supplements). You receive free leads from United Healthcare. Upon a sale, you get an upfront commission and then receive monthly residuals for the life of the policy.

 

[Golfnut2112]

I actually got my start doing what you are doing ,getting in with Medicare and then moving over to other products. There is no easier way to get appointments then starting off helping them save money on their supplements. After I did the supplement I would as a simple question
Are you happy with the interest rate you are earning in the bank? I would also consider getting a securities license because annuities are ticking tax bombs for seniors because first off they get no stepped up basis at death and they can get hit with a big tax bill down the road if they ever need money themselves.
What I would recommend is if you sell an annuity pull the interest out each year and place it into a C share mutual fund set up as a TOD account. The C share has higher expenses but the money is only locked up for 1 year. By doing this their beneficiary will not get hit with a tax bill and they will have money that is liquid to them after a few years.

By the way this is not a quick sale it may take years to develop trust so try to use annuities that accept multiple payments.

 

[Leispogo]

I have a question that maybe someone could answer for me. My parents got divorced about 7 years ago and last year my dad passed away. My mom was getting her retirement stuff together and thought she would check into my dad's pension annuity. Well a year later she found out she was still the beneficiary on the annuity and should've been getting the payment. Now here's the kicker... the annuity payments were still being directly deposited into my fathers account that had him and his girlfriend on it. (I'm on there as the pod but that means nothing). Now the annuity company is telling my mom that she has to pay back a portion of those payments that they deposited since his death before she can receive her portion of the payments because she is entitled to 50% of what he was getting. I don't get why she is being held responsible for paying back money she never received. I don't even know what to have her do. Any suggestions?

 

[DHK]

Get the money from the girlfriend. Sue her for it since she had no legal right to it upon death.

Then I would also ask the annuity company when they were notified of his death, and why they did not suspend and adjust payments upon that notification.

In the banking world, we would call that "bank error".

I do not understand why the beneficiary is responsible for THEIR error.

----------

I'd probably threaten legal action against them for essentially EXTORTING the beneficiary for THEIR error.

 

[Leispogo]

Well the annuity company said they were never notified until my mom just called to inquire about it. Does social security not notify insurance companies like they do banks? Also, the girlfriend wouldn't even let me and my sisters get anything of our fathers like ornaments and other sentimental things so getting the money from her would be a joke. I guess my mom will have to call an attorney to handle it. It just sucks that she is going to pay all these lawyer fees for $300 a month.
Thanks for your help!

 

[DHK]

There is a "Master Death File" for the purposes of life insurance death benefits, but I am not aware of them sharing that with annuity or pension companies. They might, but I am not aware of it.

Oh, and Social Security would notify the bank where the direct deposit is going, not all banks. There are thousands of banks & credit unions... and hundreds of insurance companies.

 

[Leispogo]

Well the bank had been notified of his death but the annuity payments still went in and were never returned. I guess that isn't something they take care of.

 

[VolAgent]

Get the money from the girlfriend. Sue her for it since she had no legal right to it upon death.

Then I would also ask the annuity company when they were notified of his death, and why they did not suspend and adjust payments upon that notification.

In the banking world, we would call that "bank error".

I do not understand why the beneficiary is responsible for THEIR error.

----------

I'd probably threaten legal action against them for essentially EXTORTING the beneficiary for THEIR error.

Not so fast...

If this was a life insurance policy and the company had taken payment from dad's account after his passing but before they were notified, then all premiums after passing would be returned. I've had this actually happen, money was still in the woman's account so the payments kept clearing for months. No one notified me either, so everyone thought everything was fine.

The insurance company is entitled to a return of all payments made since dad's passing. As dad's beneficiary under the contract, mom is entitled to whatever payment she should have received since dad's passing, which appears to be 50%.

Now this is the issue, unless mom had access to the account, she did not receive the payments. The insurance company should collect from whomever had access to the account and probably spent the money. They may not be able to, however that probably does not relieve them of their obligation to the beneficiary under the contract.

Sadly, mom may need a lawyer. However, a letter to the company on a law firm's letterhead may suffice. Many attorneys will offer a free initial consultation and may be willing to send one letter for free or a nominal fee.

Finally, this is quite surprising. What sparked all the lawsuits about death benefits is that insurance companies were actively checking the Master Death File for annuity beneficiaries (which dad was while alive) but not for life insurance insureds. I am quite surprised the annuity company did not catch this immediately and suspend payment. If they were checking and were lax in not noticing dad's passing, then it is completely on them.

----------

Well the bank had been notified of his death but the annuity payments still went in and were never returned. I guess that isn't something they take care of.

They wouldn't necessarily stop accepting deposits. Money may have been owned to your father and his estate, so allowing deposits is a good thing. However, they should have stopped allowing withdrawals, unless the girlfriend was a joint owner or had rights of survivorship.