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James J. Wrynn    Superintendent of Insurance    25 Beaver Street  New York, N.Y. 10004



Annuities must be suitable for buyers; agents and brokers prohibited from falsely claiming expertise in serving seniors

New Yorkers are protected by two new regulations to combat misleading practices in the sales of annuities and life insurance to senior citizens and other consumers, Insurance Superintendent James J. Wrynn announced today.

The two emergency regulations that have been put in place by the New York State Insurance Department:

“We have seen a number of cases where consumers have been convinced to buy or replace existing annuities with new annuities that are not in their best interests. This is very troubling, especially when unsuitable annuities are being marketed to senior citizens. These new regulations are critical consumer protections, especially for vulnerable seniors who need to ensure that the retirement savings they built up over a lifetime of hard work are secure,” Wrynn said.

“Consumers, especially seniors, rely on their agents and brokers to assist them in making insurance decisions,” Wrynn added. “While the vast majority of agents and brokers are honest and trustworthy, there are those few, motivated by the commissions they’ll receive, who sell annuities that put consumers’ assets needlessly at risk or use fictitious titles to mislead seniors into thinking they are qualified to help. It is our job to make sure that does not happen and correct the problem when it does.”

The first regulation is designed to stop the sale of unsuitable or inappropriate annuities such as:

Agents and brokers will now be required to consider the insurance needs and financial objectives of the consumer, based on the facts disclosed by the consumer, when recommending an annuity contract for purchase or replacement, Wrynn said.

The regulation also requires that consumers:

In New York, life insurance companies wrote $17 billion in annuity premiums in 2009. Annuities have increased in complexity, and some now require buyers to assume significant investment risk.

Deputy Superintendent for Frauds and Consumer Services Joy Feigenbaum said, “Annuities are no longer plain vanilla products. Most people buy annuities thinking their money will be safe. They need to know all the risks they may be taking, and whether each risk is appropriate for their given situation. We cannot allow seniors to unknowingly put their nest eggs in jeopardy.”

The second regulation addresses the fact that some agents and brokers use misleading titles, such as “certified elder planning specialist” or a “certified senior advisor” to gain seniors’ confidence in order to sell them insurance products. Many of these titles are obtained by agents and brokers by simply paying a fee. In recent years, the media have reported cases of sales to elderly clients, resulting in the loss of seniors’ savings, by agents or brokers utilizing these misleading titles.

This regulation prohibits the use of these misleading titles and fraudulent marketing practices linked to the use of such titles in the solicitation, sale, or purchase of, or advice made in connection with a life insurance policy or annuity contract.

“Someone with an Internet certification and no real expertise will no longer be able to impersonate an agent or broker with real training in issues affecting seniors,” Wrynn said. “Seniors need to be able to trust that the title that their agent or broker uses represents actual expertise, and this regulation will help ensure that.”

Wrynn offered tips for consumers considering buying an annuity:

If you have any questions about an annuity you are thinking of purchasing or if you have already purchased an annuity and have questions, you can contact the Consumer Services Bureau of the Department at 1-800-342-3736 for assistance.

Copies of the Department’s Consumer Guide for Annuity Products in New York are available on the Department’s website at Copies of the regulations are available at and

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