There’s always a lot of discussion regarding IUL insurance sales with only an insurance license and no securities registration.
However, in the meantime, a non-registered life agent can sell an exceedingly complicated product based on a variety of indexes that are credited based on options trading, with caps dependent on market volatility, as well as general account yields that are based on laddered bond portfolios, all governed by multiple generations of regs detailing allowable profit assumptions and the arithmetic average of the geometric mean of over 10,000 twenty five year rolling periods incorporating 66 years of back tested S&P 500 data, that are pitched as benefitting from the upside of the market without the risk of loss and commonly held out as financial and retirement planning… with no meaningful oversight.
Additionally, it’s not unheard of for this same unregistered agent to recommend cashing out of securities in a qualified plan to fund this “fixed” product. Arguably, I’ve yet to touch on the complicated aspects of the product.
Finally, this is all made possible because one guy (Senator Tom Harkin) wanted to save jobs in one industry (insurance) in one state (Iowa). Should we be surprised that it has predicated a tsunami of heartache and litigation?
Bill Boersma is a CLU, AEP and LIC and the founder and owner of OC Consulting Group. More information can be found at www.OC-LIC.com, www.BillBoersmaOnLifeInsurance.info or email at bill@oc-lic.com or call at 616-456-1000.
Securities offered through Valmark Securities, Inc. Member FINRA, SIPC. Investment Advisory Services offered through Valmark Advisers, Inc. a SEC Registered InvestmentAdvisor.
OC Consulting Group and its affiliates are separate entities from Valmark Securities, Inc. and Valmark Advisers, Inc.
