Fixed Annuity News
The fixed annuity industry is constantly changing. From product evolution and distribution consolidation to pending regulation and legislation, NAFA works diligently to keep up with every aspect of the marketplace and provide you with its most pertinent news in a timely manner. Utilize the information below to read about recent media coverage in our Monday Media Reports, access monthly advocacy updates via The Call, visit our Press Room for the association’s most current news releases or to catch up on our Twitter feed.
Industry News
Demographic Shifts Flooding the Index Annuities Market
8 APRIL – D. Korth – Nasdaq
“Every day, 12,000 individuals from the baby boomer generation in the US turn 65, and by 2030, all baby boomers will have reached this age milestone. This demographic shift has led to a change in investment priorities, with baby boomers now seeking more protection-oriented financial products, such as annuities. Annuities offering downside protection and guaranteed returns have gained popularity over those promising high growth potential.”
Annuities Soar as Source of Life Insurer Revenue
11 APRIL – Allison Bell – Think Advisor
“U.S. life insurers are getting a lot more of their retail product premium revenue from annuities than from life insurance these days.
Individual annuities accounted for $344 billion of life insurers’ $1.5 trillion in direct written premiums in 2023, or about 24% of the total, according to new industrywide totals from A.M. Best.
Only $168 billion of the premiums, or 11% of the total, came from individual life insurance.”
LIMRA: Annuity sales expected to keep breaking records
15 APRIL – John Hilton – Insurance Newsnet
“Annuity sales seemingly could not be better, with numbers smashing records nearly every quarter since the pandemic rebound. But LIMRA experts say there is more room to run.
For starters, advisors are just beginning to warm to annuities. The Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019 and SECURE 2.0 passed three years later removed many barriers to advisors offering annuities and slotting them inside retirement plans.”
BlackRock CEO Sees Annuities as Retirement Plans’ Future
15 APRIL – Allison Bell – Think Advisor
“Morningstar recently put out a report scoffing at the idea that annuitization options will have much of an effect on the U.S. retirement plan market.
Larry Fink, the CEO and chairman of BlackRock, disagrees.”
Brokerage, Annuities Industries Make Last-Ditch Effort To Delay DOL Fiduciary Rule
15 APRIL – Tracey Longo – Financial Advisor
“With the Department of Labor’s latest fiduciary rule on a path to be finalized by the end of the month, 11 broker-dealer, annuities and insurance trade groups made one last effort today to get the agency to delay finalizing the rule and continue the public input process.
In a letter sent today to the White House, DOL Acting Secretary Julie Su and Office of Management and Budget Director Shalanda Young, the 11 industry associations, including the Financial Services Institute (FSI) and Insured Retirement Institute (IRI), contend that because the agencies rushed the process to get the DOL’s “Retirement Security Rule” to the finish line, they are ignoring the rule’s devastating effects and likely legal challenges.”
Trade groups express concern about regulatory process on DOL fiduciary rule
15 APRIL – PR – Insurance Newsnet
“A group of 11 industry trade associations sent a letter to the U.S. Department of Labor and others expressing concerns about the regulatory process with regard to the Department of Labor’s proposed “Retirement Security Rule: Definition of an Investment Advice Fiduciary.”
The letter was sent to Secretary of Labor Julie Su, White Office of Management and Budget Director Shalanda Young, and Office of Information and Regulatory Affairs Administrator Richard Revesz.”
The Department of Labor’s Fiduciary Proposals
16 APRIL – Faegre Drinker Biddle & Reath LLP – JD Supra
“On November 3, 2023 the Department of Labor (DOL) published its new proposed regulatory package redefining fiduciary investment advice and materially amending prohibited transaction exemptions for compensation resulting from investment and insurance recommendations to “retirement investors” — that is, to private sector retirement plans, participants in those plans and IRA owners. The proposed guidance has since been finalized and sent to the Office of Management and Budget (OMB) in the White House. The final rules have been approved by the OMB and may be publicly available as early as May 1.”
Retirement Lost & Found: DOL Proposes Voluntary Reporting
17 APRIL – Groom Law – JD Supra
“The SECURE 2.0 Act of 2022 directed the Department of Labor (“DOL”) to establish a database that individuals can search to help locate their retirement benefits. The database – referred to as the Retirement Savings Lost and Found (the “Lost & Found”) – was originally intended to leverage existing filing requirements, but the Internal Revenue Service (“IRS”) determined it could not legally share Form 8955-SSA data with DOL. Consequently, DOL has issued a proposed procedure (the “Proposal”) to collect data directly from plan administrators on a voluntary basis via a new filing made along with, but not as part of, the Form 5500. DOL has requested comments on the Proposal by June 17, 2024.”
New ‘Fiduciary Rule’ Is Coming in Long Fight Over Retirement Advice
Today, loopholes allow advisors and insurance brokers and agents to recommend products that might not be the best option for clients.
18 APRIL – Elizabeth O’Brien – Barron’s
“The Biden administration is expected to unveil a final rule in the coming weeks that would hold certain advisors to a higher standard when offering retirement investment advice, continuing a regulatory battle that has lasted more than a decade.
Announced last fall, the rule aims to protect retirement savers from conflicts of interest when they roll assets from an employer-sponsored plan like a 401(k) into an individual retirement account or annuity. Today, loopholes in existing regulations allow advisors and insurance brokers and agents to recommend products that might not be the best option for clients. They could steer clients to a pricey annuity that pays them a fat commission, for example, rather than a cheap index fund that will outperform over time.”
Can This Annuity Ease Social Security Claiming Pressure?
18 APRIL – Allison Bell – Think Advisor
“Paul Tyler sees agents and advisors as navigators who help retirement savers steer past a complicated, irreversible obstacle: the Social Security claiming date.
Tyler is the chief marketing officer at Nassau Financial, a life and annuity issuer that recently released a product designed to fit with a client’s claiming strategy.”
Monday Media Report
The NAFA Media Report features a summary of the previous week’s fixed annuity media coverage. NAFA welcomes your contributions and suggested additions.
The Call
The Call features timely and seasonal regulatory and legislative updates to help NAFA members stay on top of issues impacting their businesses. Both federal and state editions are distributed to keep you informed.