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Why Is There So Much Annuity “Bait And Switch” Marketing Going On?

Stan The Annuity Man

Question: I’ve been shopping for annuities online, and it seems that most sites are using worn out “bait and switch” type sales tactics.  It’s very frustrating, and I’m wondering why is this allowed by the regulators?  Tim from Colorado.

Answer: Tim, I’m as frustrated as you with these sites and ads.  These types of marketing and sales practices continue to feed into the negative stigma that the annuity industry has unfortunately earned.  I’m sure from the public’s view it looks like a free for all where no rules exist.  When it comes to annuity advertising, that’s a pretty good description.

Annuities are regulated at the state level, not the federal level.  Every state has a regulatory body that is supposed to oversee these types of inappropriate ads and websites.  Unfortunately, I don’t have a lot of faith in the states that are supposed to enforce these unscrupulous actions.  Their track record is not very good, and they usually move at tortoise speed to address these types of advertising problems.

Most of the “bait and switch” tactics and outright advertising fraud happens with fixed indexed annuities.  With commonly and incorrectly hyped “hybrid annuities”, it’s typical to see pop up ads and educational “front” videos that pitch too good to be true sounding strategies with high % guarantees.  By the way, if it sounds too good to be true….it is…no exceptions!  Recently, a non-insurance licensed review site did a pretty good job of picking apart these internet annuity promoters (click here to read to full review).

Even the simplest and most efficient annuity design, Single Premium Immediate Annuities (SPIA’s), are being inappropriately promoted on the web as well.  One of the most popular sites that only sells SPIAs has an online quotation system that gives a “ballpark” of what the actual quote would be.

These “teaser quotes” are totally misleading and creates confusion when people actually want a real quote in order to make an important financial decision.  I guess that site is OK with the fact that they are starting their client relationship with a purposely inflated quote.  No agent, site, or advisor one can get a better SPIA quote than the next guy, and we all use the same quotation service (CANNEX) that works as a clearinghouse and filter for the vast majority of carriers.

The wild, wild west is alive and well with annuity internet promoters.  Buyer beware is all that I can say.  So always do your homework, and be very careful not to take the annuity sales bait.

*If you have a question for Stan The Annuity Man, please send your question to  He will answer all questions directly, and might include yours in his next Annuity123 “Ask Stan The Annuity Man” blog.

Click here to see more of Stan’s educational articles.

About the Author:

Stan The Annuity Man is a nationally recognized annuity expert and annuity critic, and has been called the national consumer advocate for annuities… and a walking middle finger of annuity truth.  He is a weekly RetireMentor columnist for The Wall Street Journal’s, and is the exclusive annuity contributor for  His highly acclaimed book, The Annuity Stanifesto, is a top seller in its category, and is known as the go to resource for all things annuity.

Stan The Annuity Man has clients nationwide, and is considered one of the top independent annuity agents in the country.  You can learn more at


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  • Jason Wenk says:

    Great article Stan. Thanks for the link over to Annuity Gator too!

  • Stan Haithcock says:

    Thanks Jason. I have no idea who "Annuity Gator" is, but his content was right on the money concerning the annuity internet promoters. I wish you the best. Stan The Annuity Man.

  • Lawrance Jackson says:

    Points mentioned in your post are very important points to consider while buying annuities. It is true that many sites are using such tactics to sell annuities, but it's in our hands whether to buy it or not. Best way to deal with it is to have financial planner to look after it and guide you for buying annuities, so that you can get better annuity option for buying and your investments will be worth.

    • Brad Maxwell says:

      It may be best to use a financial planner who has your best interest at heart and is not solely interested in lining his own pocket. Someone like that may be hard to find. There are unscrupulous planners everywhere. Be careful who you use. Sometimes even a personal reference isn’t enough. The planner could be scamming the referrer and he isn’t even aware that he is being screwed. A fee only planner who is a fiduciary is probably the place to start. Good luck

  • Scott Carnoali says:

    I saw a sentence that described “Stan the Annuity Man” as hated by the industry but loved by the consumer. I just called to ask him a question and he hung up on me while I was still talking. I’m not thinking he is too “loved” by the consumer. I would not recommended him at all.

  • marilyn says:

    Hi All,

    I literally just spoke to Stan,
    He was in the airport and placed a call to me to chat about an annuity I was thinking of purchasing. He absolutely did not try to sell me anything. Basically, said the company I was thinking about, Gainbridge was definitely a good company to deal with and do not hesitate to go with them.
    It is refreshing to feel like someone is actually being HONEST!

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