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|Subject: A new way for insurers to charge high fees||Date: 2/5/2013 1:47 AM|
|Author: intercst||Number: 71346 of 75607|
At least the states with well- funded insurance regulators (NY, NJ, Calif.) aren't letting these puppies come to market -- but beware in the other 47 states.
Regulators in some of the biggest states have yet to approve these "contingent deferred annuities." They are worried that lifetime-income guarantees sold on a mass scale could be harmful to insurers' financial health if markets were to slide as they did in 2007-09, putting insurers on the hook for massive payouts.
One of the few new guarantees on the market comes from Aegon NV's AGN.AE -4.43% Transamerica Advisors Life Insurance unit. Buyers pay an annual fee of 0.85% to 1.75% of the value of a portfolio built from an approved list of mutual funds and exchange-traded funds. That comes on top of underlying fund fees.
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