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Elderly Annuities

Des Moines, IA: (Feb-11-08) Minnesota's Attorney General Lori Swanson brought a lawsuit against American Equity Investment Life Insurance Co., a life insurer, alleging that the company sold long-term deferred annuities to senior citizens that weren't suitable for their financial needs. Records show that Swanson also sued another life insurer over alleged deceptive sales of annuities to the elderly, marking her fourth such suit since she took office in January 2007.

Sources close to the case revealed that the action against American Equity, filed in April 2007, accusing the company of selling high surrender-fee annuities to senior citizens, reached a settlement with Swanson's office, resolving litigation. The deal, approved in Hennepin County District Court, is based on her settlement with Allianz Life Insurance Company of North America, announced in October 2007, and allows up to 2,400 seniors to make claims for refunds totaling $125 million. Additionally, American Equity, a top seller of equity-indexed annuities in the United States, also agreed to pay the state $250,000. [TRADING MARKETS: ELDERLY ANNUITIES]

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Published on Feb-13-08


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