Equity Indexed Annuity (Elder Abuse) – Fort Lauderdale, Boca Raton, Delray Beach, Lake Worth and West Palm Beach, Florida Insurance (fixed and variable annuity) and Securities Fraud and Misrepresentation FINRA Arbitration and Litigation Attorney:
An Equity Indexed Annuity is an annuity whose interest or other types of earnings, during the accumulation period, are linked to rises in a stock index. Such contracts have a minimum annual return that guarantees principal, so they can offer upside potential and downside protection. They sometimes come with a cap and usually have early withdrawal (surrender) penalties.
Recently, we have seen an increase in the twisting of fixed and variable annuity and other types of insurance products. Twisting is the unethical practice of convincing a customer to trade and insurance product unnecessarily, thereby generating a commission for the broker or salesperson. An example of twisting in the insurance arena arises when an insurance salesperson persuades a policyholder to cancel his or her policy or allow it to lapse, in order to sell the insured a new policy, which would be more costly but which would produce sizable commissions for the salesperson. The damage associated with this unethical practice is particularly devastating to the elderly.