Minnesota’s Attorney General and Great American Financial Resources announced a settlement over disputed sales of deferred annuities to seniors in the state by Great American subsidiaries. The agreement covers 2,000 policies placed by Great American Life Insurance Company and its affiliates, Annuities Investors Life and Loyal American Life, with an estimated value of about $50 million, according to the state’s AG, Lori Swanson. The settlement allows seniors who bought annuities from the companies to submit refund claims. It also requires the companies to improve its suitability review procedure to assure annuity sales to seniors are appropriate.
Unfortunately the ability Seniors in Mississippi to effectively pursue a remedy from being sold an inappropriate annuity product is limited by the absence of a rule permitting class actions, and the change in Mississippi Rule of Civil Procedure 20, which makes it much more difficult for parties to join litigation into a single suit where it can be efficiently prosecuted by a group of similarly situated plaintiffs.
Seniors and their loved ones should be wary of individuals trying to sell them deferred annuities. While there is an appropriate place and strategy for the use of these products, often the primary motivation is simply to earn the salesman a commission. Annuities are complicated contracts and Seniors need to make sure they understand what they are agreeing to before investing, and possibly making it inaccessible when they may need it most, their money in such vehicles.
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