Investors purchase annuities in order to protect themselves from risk. The most common reason is to provide themselves with a source of income after they retire—and annuities are an excellent way to do this, as the life of the annuity will typically far exceed the amount of years you are expected to live.
However, when a broker sells you an annuity inappropriately, you could be entitled to repayment if you lose out on your returns. Continue reading to learn more about why an annuity can be considered unsuitable and how you might bring a lawsuit against your broker for inappropriate annuity selling.
When Annuities Become Unsuitable
For the most part, annuities are seldom a good option, as there are several other financial instruments you can use to protect yourself. The problem with annuities is that they are complex and rarely meet the objectives of the investors. Despite this fact, annuities have been, and will likely continue to be, sold to investors.
This is because in these circumstances, a broker is essentially a salesperson trying to sell you the annuity. As such, they may come away with a huge commission, sometimes as high as 20 percent, giving the broker a “good” reason to do everything they can to get your purchase… even if that means engaging in misconduct.
Violating the Duty of Fair Dealing
If your broker has misrepresented the terms of the annuity or sold you an annuity as a senior citizen without fully disclosing how the annuity could affect you, then they’ve committed fraud.
Annuities fail all the time, whether it be by massive tax penalties you didn’t expect, lack of information about possible surrender charges, or otherwise being misled by unscrupulous brokers into purchasing the annuity.
Either way, if you lose out on money, or if you discover that you were tricked into purchasing an annuity that didn’t align with your retirement goals, you’ll want a high-powered attorney to represent your case in FINRA arbitration.
Contact an Unsuitable Annuity Lawyer
Getting out of an annuity is sure to be a struggle, but if we can prove that your broker committed fraud in order to secure the commission they made off of your annuity sale, we may be able to recoup your investment loss.