Improper Life Insurance and Variable Annuity Replacements in Violation of Regulation 60 Rules of the Insurance Department of the State of New York

Stockbroker Law - Tuesday, September 13, 2011
Improper Life Insurance and Variable Annuity Replacements in Violation of Regulation 60 Rules of the Insurance Department of the State of New York

Regulation 60 of the New York State Insurance Department requires that brokerage firms, stockbrokers, financial advisors, and insurance salesmen who recommend the replacement of existing insurance coverages, such as whole life insurance policies, as well as variable annuity policies, properly complete, file, and present required disclosures of any such proposed replacements, for customer signature.  The purpose of this law, among other things, is to prevent the unscrupulous practice of stripping away the current cash-value of existing life insurance policies with supposed new policies with claimed better features. 

Abuses involving the failure to properly follow and correctly and honestly complete Regulation 60 required disclosures also include the recommendation of the early surrender of variable annuity products, which can result in considerable surrender charges being incurred by clients of as much as 7% of the entire value of the account.

If you feel you have been victimized by way of the recommendation of a new policy of life insurance with the simultaneous recommendation of the surrendering of an existing policy of life insurance or a variable annuity, we offer a free initial consultation to address any inquiries you might have and to advise you of your rights.

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