Michael LaVoy CFP, ChFC Announces Public Information Campaign

TAMPA– Michael LaVoy, president, Beacon Asset Management (Beacon), a fee-only, Registered Investment Advisor (RIA) operating in the Carrollwood area of Tampa, Florida announced to the Carrollwood Area Business Association (CABA) that Beacon will be undertaking a public information campaign throughout the month of July.

Specifically, the Beacon campaign will be addressing misinformation and consumer misunderstanding with regard to the sale and promotion of annuities as retirement products, "guaranteed safe." LaVoy, an investment advisor and financial planner, said that most consumers believe that "guaranteed" means guaranteed by the federal government like FDIC insurance for bank deposits or Treasury bills.

"Annuities are backed only by their issuing insurance company; accordingly, a policyholder's investment in an annuity is only as safe as the insurance company's ability to pay claims on demand. Most sales agents, carrying the title financial advisors, either don't know or don't disclose any risk or downside to policyholders investing in annuities," said LaVoy. He added, "…and seniors over the age of 65 continue to be targeted in a market environment where they are earning 1% or less in their fixed income/investment accounts."

Effective December 25, 2009, the Florida legislature passed 69B-162.011, Suitability and Disclosure in Annuity Contracts, "This rule applies exclusively to any recommendation to purchase or exchange an annuity contract…made to a senior consumer by an insurance agent or an insurer, which results in the purchase or exchange recommended." The Florida rule applies to seniors age 65 years or older; whereas, many states have adopted suitability and disclosure laws that apply to all prospective annuity owners.

"As far as those "guaranteed returns," federal regulators are seriously scrutinizing the way in which variable annuities are guaranteeing those returns, while some issuers (i.e., AXA/Equitable and The Hartford) are changing annuity contracts to decrease their liability and/or "guaranteed" rate of return," said LaVoy.

For more information about Beacon Asset Management and its public information campaign, or to schedule Michael LaVoy for an interview or speaking engagement, call the Beacon offices or go online to schedule an appointment or subscribe to the Weekly Beacon or the Beacon Blog at www.beaconria.com.