"Consumers should understand the full impact of any decisions they may make to liquidate or replace annuities they already hold," said Dilweg. "If you liquidate or replace an annuity you currently own, you may be incurring significant surrender charges or experience adverse tax consequences. My office will be monitoring the suitability of annuity sales for activity that would appear to take advantage of the recent turmoil in financial markets."
Annuities are insurance products regulated by the Office of the Commissioner of Insurance (OCI).
OCI licenses both companies and agents and monitors their activities.
Dilweg reminded consumers that state law requires a suitability analysis before the sale or replacement of any annuity product.
A suitability analysis should include an evaluation of a consumers financial position, income needs and cost of liquidating any assets.
Consumers are encouraged to discuss any changes to their financial plan with a trusted advisor or family member before altering their investments.
Consumers should be particularly cautious if they are approached to liquidate annuities issued by an AIG insurance company because of the recent activity concerning AIG Holdings, Inc.
Commissioner Dilweg said, "The AIG insurance companies are separately regulated by state insurance regulators and do not have the financial stress that AIG Holdings, Inc. is experiencing. They are meeting all their obligations to their policyholders. Consumers who feel pressured to replace annuities because of claims the insurer is under financial stress are encouraged to contact OCI. "