Breaking news: SEC approves Ruling 151A
102 RepliesJump to last post
You do realize EIAs are not an investment, right?
Anyway, I cannot comment on what, if any, alterior motives my B/D had in restricting use of EIAs withh clients. The official line is what I'm going with until someone tells me otherwise. For the record, I see why they have taken that stance. One less compliance issue to worry about means more time they can spend on more productive pursuits.Never mind, I’ll re-phrase, “I only ask because I can’t imagine any BD forbidding the sale of any
type of insurance product that is both a great value to the client and very
profitable to the BD, whether it is regulated by the SEC or not.”
[quote=deekay]
Anyway, I cannot comment on what, if any, alterior motives my B/D had in restricting use of EIAs withh clients. The official line is what I'm going with until someone tells me otherwise. For the record, I see why they have taken that stance. One less compliance issue to worry about means more time they can spend on more productive pursuits.[/quote]I respect your humility. Perhaps others here may have some input. Are there any folks from, oh, I don't know, Merrill, UBS, AGE/WB, MS, Smith Barney or others who can answer my question, which is, "Why would any BD forbid the sale of any investment (insurance product/contract) that is both a great value to the client and very profitable to the BD?"
[quote=YHWY] [quote=deekay]
Anyway, I cannot comment on what, if any, alterior motives my B/D had in restricting use of EIAs withh clients. The official line is what I'm going with until someone tells me otherwise. For the record, I see why they have taken that stance. One less compliance issue to worry about means more time they can spend on more productive pursuits.[/quote]I respect your humility. Perhaps others here may have some input. Are there any folks from, oh, I don't know, Merrill, UBS, AGE/WB, MS, Smith Barney or others who can answer my question, which is, "Why would any BD forbid the sale of any investment (insurance product/contract) that is both a great value to the client and very profitable to the BD?"
[/quote] I would guess that they don't sell them because of the regulatory uncertainty combined with their focus on AUM vs. insurance products. There's a reason most wirehouse reps don't sell any insurance products. There's no margin for the rep or the firm when commissions must be put through the grid.
[/quote]
There's a reason most wirehouse reps don't sell any insurance products. There's no margin for the rep or the firm when commissions must be put through the grid.[/quote]That is 100% contrary to my experience, if you consider AGE to have ever been a wirehouse. Any other wirehouse folks have any input?
[quote=Borker Boy]
Oh yeah, baby!
Time to hit the books, Hank/Bobby. http://www.seniormarketadvisor.com/r/smaMag/d/contentFocus/?adcID=32aa5c9781bc7d33721c877a08ea9887[/quote]What books?
[quote=Borker Boy]Sure, he can still sell them, but now he’ll wonder whether big brother is listening in on his seminars at the nursing home.
[/quote]You are a Jones broker. Enough said.
[quote=Hank Moody]
[quote=Borker Boy]
Oh yeah, baby!
Time to hit the books, Hank/Bobby. http://www.seniormarketadvisor.com/r/smaMag/d/contentFocus/?adcID=32aa5c9781bc7d33721c877a08ea9887[/quote]What books?
[/quote]
GREAT forecheck!!!!
[quote=Borker Boy]That’s a great question. I’m glad you asked.
Actually, I hate Mike Ditka, so he can keep his money. Let's talk about you, Butkus. I know you can scrounge up a piddly $1 million, and at that level, there will be NO sales charge--coming or going. NONE, ZERO, ZILCH. No 15%, fifteen year surrender penalties, no caps, no participation rates, no crazy crediting methods to have to contend with. Just 100% transparency. So, what's it gonna be, butt kiss?[/quote]Which of the companies held in your american funds have going concern qualifications?
There's a reason most wirehouse reps don't sell any insurance products. There's no margin for the rep or the firm when commissions must be put through the grid.[/quote]
That is 100% contrary to my experience, if you consider AGE to have ever been a wirehouse. Any other wirehouse folks have any input?
[/quote] My experience is that I sell more death benefit in a month than most wirehouse reps sell in their entire careers. Same thing goes for disability income insurance. Bottom line is, when I get a net 85% payout on insurance products vs. a wirehouse rep who gets a net 20% payout, it's not hard to see why a wirehouse rep will focus much more on marketable securities and charging AUM fees.
It doesn’t go into effect until January of 2011. That leaves plenty of time to reverse the ruling.
Then why doesn’t your firm allow EIA’s? They are obviously comfortable with sophisticated insurance products, some of which are and have been overseen by the SEC?
There's a reason most wirehouse reps don't sell any insurance products. There's no margin for the rep or the firm when commissions must be put through the grid.[/quote][quote=YHWY]
That is 100% contrary to my experience, if you consider AGE to have ever been a wirehouse. Any other wirehouse folks have any input?
[/quote] My experience is that I sell more death benefit in a month than most wirehouse reps sell in their entire careers. Same thing goes for disability income insurance. Bottom line is, when I get a net 85% payout on insurance products vs. a wirehouse rep who gets a net 20% payout, it's not hard to see why a wirehouse rep will focus much more on marketable securities and charging AUM fees.[/quote]
I love asking people why the suppose their brokers never mentioned insurance products to them.
[quote=YHWY]Then why doesn’t your firm allow EIA’s? They are obviously comfortable with sophisticated insurance products, some of which are and have been overseen by the SEC?
[/quote]
B/D’s don’t allow EIA’s because they can’t get a piece of the action. I guarantee you that the b/d’s were much of the driving force behind turning them into securities.
Hank,
As a business owner in this very field, I’d love your input as to why would any BD forbid the sale of any product that is both a great value to the client and very profitable to the firm? Especially one (EIA’s) that you’ve provided so much valid, positive information about?
Sorry, jumped the gun. That answer doesn’t hold water. EIA’s can be mandated to Be run through the firm at any BD just like any other annuity and, like any annuity, they can set the payout wherever they choose (keeping whatever “cut” they choose).
Back on topic, does anyone know what happens to existing EIA’s when (or if) this rule is enacted?