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New Year Law Will Protect California Seniors From Sham Insurers

SACRAMENTO (CBS SF) — There will be some new protection on the books in 2012 to keep seniors from being hoodwinked by aggressive insurance salespeople.

State Insurance Commissioner Dave Jones says vulnerable segments of the population are often taken advantage of.

“I have been told horror story after horror story,” he summed it up.
Lately, he’s been hearing horror stories about seniors.

“Annuities, for example,” he said. “Where your money is tied up for a very long period of time, often times well past your life expectancy and if you want to get at that money you have to pay a very high surrender penalty.

Jones says annuities can be a very useful financial product, depending on where you are in life. A law to take effect in January will require those who sell annuities to make sure consumers can actually benefit from them.

“(This) puts the burden on the insurers and agents and brokers to assess the suitability of the products that they’re selling,” he explained. “We have very significant authority to investigate fraudulent behavior in this area and we’re happy to use that authority.”

KCBS’ Patti Reising Reports:

Consumers with questions or complaints can call the Department of Insurance hotline, (800) 927-HELP.

(Copyright 2011 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

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