November 22, 2011 Comments (0) Blog, Securities Fraud

John Hancock Scales Back Variable Annuity Offerings and Exposure

(Last Updated On: July 17, 2015)

According to a recent article in the investmentnews.com, John Hancock “has pulled back on its annuity distribution and expects to withdraw an array of fixed, variable and immediate annuities.” Included amongst the annuity cuts are John Hancock’s Venture 4 Series, 7 series and Frontier variable annuities.

One of the key reasons John Hancock is decreasing the annuities on offer, especially variable annuities, has to do with risks and exposure. The chief executive of John Hancock’s parent company was quoted as saying, “Variable annuities … are a product that we don’t want to have a gigantic exposure to, moving forward.” He further stated, “I think any sensible person would attenuate exposure to those products, given some of the risks they expose one to.”

Variable annuities can be risky for investors and variable annuity insurers alike. Investmentnews.com noted that John Hancock had “reduced earnings by $1.78 billion, $900 million of which came from an increase in VA hedging liabilities.” While variable annuities are a legitimate investment option for some investors and portfolios, they are not for everyone. Variable annuities also are widely available to investors and for brokerage firms to sell. It is reported that John Hancock is 15th largest variable annuity provider.

The White Law Group has represented many investors in FINRA claims against brokers and brokerage firms over the sale of variable annuities. Variable annuities may not be right for all investors, like retirees or investors needing an income stream, due to the high surrender charges that make accessing money tricky. Variable annuities are also a relatively high commission product, which in some cases may explain a financial professional’s recommendation to buy a variable annuity. “Annuity switching,” where brokers sell one annuity and buy another, is also a concern for securities regulators like FINRA.

If you are concerned about your investment in a variable annuity, or another annuity product, and would like to speak to a securities attorney about your potential to recover investment losses through FINRA arbitration please contact our Chicago office at 312-238-9650.

The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm with offices in Chicago, Illinois and Boca Raton, Florida.

For more information on The White Law Group, please visit our website at http://www.whitesecuritieslaw.com.

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