Experts: States lack clear rules on source of funds for annuities

05/5/2013 | National Underwriter Life & Health

Insurance-only agents with clients looking to liquidate securities in order to buy a fixed annuity must protect themselves in the absence of clear regulations governing such transactions, experts say. An agent who gives comprehensive financial advice may choose to pursue a securities registration, but shouldn't have to, says John Olsen of Olsen Financial Group. The agent also could ask the client to sign a letter specifying the agreed-to course of action concerning the source of funds, Olsen says. "This is a terrible, potentially disastrous problem because agents could have their whole lives ruined for transgressing a rule they didn't even know existed," he says.

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