Originally Posted by smooch
* *Does M&E mean Management and Expense? I thought that was included in the expense ratio. Could there be other fees as well?*
M&E means "Mortality & Expense" fees. In most variable annuities, there are several layers of fees:
- Contract charges levied to pay for policy administration
- mortality and expense fees, to pay for the true mortality insurance coverage and insurance-related expenses
- The expense ratio of the underlying fund
- any guarantee fees for minimum withdrawal, minimum death benefit, and other corny guarantees
For a VA with minimum withdrawal, etc. guarantees, it is typical to see expense ratios in the 3 to 3.75% range!
Smooch, the hooker agent is playing games with you. Making up a benchmark, not having an open discussion of expenses, and frankly, selling you a wholly unsuitable product in the first place.