You need to know about your variable annuity contract before you exchange it. When you own a variable annuity contract a broker may put a temptation to offer you an opportunity to exchange your contract for another one. Should you consider this? Maybe, but it may not be in your best interest.

The problem with exchanging one contract for another is the broker or agent can spin a story to make it sound very attractive. What you need to keep in mind is the grass is not always green on the other side of the fence. Your contract may offer the same or better benefits that can be added after the purchase of the variable annuity.

That's right; many companies offer the opportunity to purchase the newer benefits to existing variable annuity policy holders. Many times the agent does not realize this or just wants to earn a commission. When that is the case that part is left out of the sales pitch. The availability of new features that are not offered by your current annuity company, or in the rare case that the insurer has financial troubles, are really the only reasons to switch variable annuity contracts.

You should never, ever exchange a variable annuity for another if you are still subject to a deferred sales charge, or penalty. Many brokers tell you that you can make up the surrender charge with a new