A variable annuity is a contract between you and an insurance company. It serves as an investment account that may grow on a tax-deferred basis and includes certain insurance features, such as the ability to turn your account into a stream of periodic payments.

Do brokers sell annuities?

Annuity issuers: Only insurance companies issue annuities. While companies like AXA, Ameriprise, MetLife, and others still have these agents, many annuities are sold by independent agents, brokers, and bank officers.

Are variable annuities investment companies?

There are different types of investment companies, mutual funds, exchange-traded funds, unit trusts, and variable annuities. They each have different features but they all have one thing in common. They’re regulated by the Investment Company Act of 1940.

Are variable annuities professionally managed?

Variable annuities and mutual funds are very popular investments. They both offer the average investor the benefits of professionally managed money and diversification.

Who are the companies that sell variable annuities?

Pacific Life sells fixed and variable annuities. Prudential sells life insurance, mutual funds, group insurance, retirement services, investment management services and variable annuities. The company was founded in 1876 and is based in New Jersey.

How are variable annuities regulated by the SEC?

Variable annuities are securities registered with the Securities and Exchange Commission (SEC), and sales of variable insurance products are regulated by the SEC and FINRA.

What are the commission levels on variable annuities?

Variable Annuities (VAs) Have Steep Commissions. The typical surrender charge period is 5 to 9 years, so normal commissions levels could be 4% to 7%. Payouts also depend on the specific carrier.

What are the features of a variable annuity?

A typical variable annuity offers three basic features not commonly found in mutual funds: 1 tax-deferred treatment of earnings; 2 a death benefit; and 3 annuity payout options that can provide guaranteed income for life.