Recover Your Losses With The Help Of A Seasoned Insurance Fraud Lawyer In Pittsburgh
Many lawsuits and arbitration proceedings involve claims related to the sale of annuities (particularly variable annuities), variable life insurance and other insurance-related products. Attorney Michael J. Betts is an insurance and annuity fraud lawyer with decades of experience in this field of law. He has in-depth knowledge about the federal and Pennsylvania laws that apply to transactions involving annuities and insurance, secondary market fraud and claims against unlicensed agents.
Common Types Of Insurance And Annuity Fraud
In recent years, a high percentage of claims related to insurance and annuity products have involved variable annuities. Variable annuities are complex products that are not readily understood by many investors. An insurance fraud lawyer like attorney Betts provides legal advice and representation to clients who have lost assets due to various forms of misconduct by brokers and agents, including:
- Misrepresentations and nondisclosures: Investors often allege that they were induced to purchase variable annuities in reliance on fraudulent or negligent misrepresentations, or through a failure on the part of the broker or financial adviser to disclose all of the material terms of the variable annuity.
- Churning, twisting or switching: Investors may allege that an annuity that replaced a previously purchased one was recommended to generate additional commissions for a broker or financial adviser and the firm. This often involves undisclosed commissions and may result in high surrender charges that leave money trapped.
- Unsuitability: A fundamental duty of a broker is to recommend suitable investments. Many cases involve situations where a broker is alleged to have sold a variable annuity that was not suitable, particularly when the investor is a senior.
This FINRA Investor Alert discusses many of the issues related to variable annuities, of which investors should be aware when considering the purchase of a variable annuity.
The legal theories that can be employed to pursue these cases may include claims under the federal securities laws, including Section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. §§ 78a et seq. and Rule 10b-5; as well as state statutory and common law claims such as violations of the Pennsylvania Unfair Trade Practices and Consumer Protection Law, 73 P.S. §§ 201-1 et seq., fraudulent and negligent misrepresentations and nondisclosures, and breach of fiduciary duties.
Addressing Issues With Variable Universal Life (VUL) Insurance
Another insurance product that has been the subject of extensive litigation is variable universal life (VUL) insurance. VUL policies are confusing and can be the subject of claims that challenge whether a financial adviser or insurance agent accurately represented their terms at the time of sale.
Many investors who purchase these policies do not understand – because they are not told – that sustaining the cash value of the policy and supporting a promised level of death benefit may not be realistic. As a result, investors can find themselves in a position where they either need to replenish the policy with additional funds or surrender the policy at a significant loss.
Many investors in VUL policies often do not realize the extent to which these policies are burdened with a myriad of fees and that a significant portion of the premiums paid is used to cover those fees before any return can be realized on the investments within the policy. In addition, many investors do not fully understand that financial advisers are highly incentivized to sell these policies, which can lead to failures to disclose and other abuses.
The federal Securities and Exchange Commission (SEC) has issued an Investor Bulletin describing variable life insurance and the factors that investors should consider in deciding whether to invest in such a policy.
Review Your Insurance Rights: Call Michael J. Betts LLC Today
The path to recovering assets lost to fraud can be complex. It’s wise to work with a seasoned insurance fraud lawyer who can provide the focused attention your case deserves. Discuss your case with attorney Betts today. Schedule a consultation by calling him at 412-899-6827 or filling out this online contact form.