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
13 APR – Cyril Tuohy – Life Annuity Specialist
More Annuity Reserves Now Held by Lower-Rated Insurers
“A higher proportion of the industry’s individual annuity reserves are held by insurers with lower credit ratings compared with 2007, according to new research, due to both downgrades of incumbents and lower-rated new insurers flooding into the industry.”
15 APR – Cyril Tuohy – Life Annuity Specialist
More Annuity Carriers Turning to ‘Ladder’ Strategies to Offer Flexibility
“The laddering strategies recently popping up among new annuities suggest new efforts to test-market the structures with advisors and consumers, according to a leading trade group executive, as carriers angle for new ways to differentiate their products in an increasingly crowded and commoditized sector.”
15 APR – John Hilton – Insurance News Net
‘All-weather’ annuity portfolios aim to sharply limit rainy days
“Shifting economic conditions — including higher interest rates, market volatility and increased regulatory scrutiny — are forcing companies to rethink how they design and manage annuity products, with a growing focus on so-called “all-weather” portfolios.
A panel of industry executives discussed what the term means and what it looks like Monday during an opening session at the LIMRA Life Insurance and Annuity Conference.”
15 APR – Tracey Longo – Financial Advisor
Fixed Annuities Boost Retiree Income By 30%, New Study Finds
“Allocating 30% of retirement savings to fixed annuities can increase annual income by nearly $12,000 on a $1 million portfolio while also reducing exposure to market volatility, according to a new analysis from the TIAA Institute.
A retiree age 67 withdrawing 4% annually from a $1 million portfolio would generate about $40,000 in first-year income. But shifting roughly one-third of those assets into a fixed annuity and applying a 4% withdrawal to the remaining balance raises first-year income to $51,867, or about $989 more per month, the new study found.”
16 APR – Jake Klima – Kiplinger
Old Annuities Contain Untapped Potential for Clients and Advisers: Here’s Why
“Annuity buyers saw a surge in payouts in 2022 and 2023 because of persistent Federal Reserve interest rate hikes. Now, after two years of cuts, economists believe rates could be back on the rise later this year owing to inflationary pressures stemming from the Iran war.
These shifting dynamics highlight why it’s essential to reevaluate older annuities — helping ensure your clients continue to maximize their retirement income potential, no matter how the market evolves.”
17 APR – John Hilton – Insurance Newsnet
Human connection still key in the new annuity era
“Consumer trust and confidence are significantly higher when a financial professional is involved, according to LIMRA research, as pandemic-driven changes continue to reshape how annuities are sold and serviced.
Two major shifts have defined the post-pandemic landscape: a lasting evolution in advisor workflows and a growing emphasis on delivering trusted advice through increasingly digital distribution models.”
17 APR – William Burrowsclock – Professional advisor
Market turbulance, de-risking for retirement and the crucial role of annuities
“Annuities are now back to pre-2008 credit crunch levels
It is at times like this when an unexpected event causes severe market volatility that we are reminded of the importance of de-risking, especially in later life. William Burrows explores the issues…”
20 APR – Ken Nuss’s Avatar – Kiplinger
Too Scared to Dive Into a Fixed-Rate Annuity? Interest Rates Make It Worth Dipping Your Toe In
“Money-market funds and savings accounts are liquid and stable, and can offer competitive rates. What’s not to love? Well, you could be earning more on your money elsewhere, especially now that money-fund rates have declined and may be heading lower.
While you need full access to some of your money to pay the usual bills and as a safety valve for surprises, such as an expensive auto repair or a medical bill, overinvesting in cash-equivalent funds has an opportunity cost. The key is to strike the right balance.”
20 APR – John Hilton – Insurance News Net
Annuity industry grapples with consolidation, innovation and planning shifts
“Consolidation among distributors, evolving technology and changing consumer expectations are reshaping how annuity products are developed and sold, even as overall sales surge.
A diverse panel of annuity sales executives reached those conclusions during a session at the LIMRA Life Insurance and Annuity Conference.
Panelists described a market in transition — one moving away from purely transactional sales toward broader financial planning, while also grappling with operational complexity and growing competition.”
20 APR – David Lau – Barrons
Do Financial Advisors Commit Malpractice When They Don’t Consider Annuities?
“In the recent Barron’s Advisor article “How to Make Sure You Have Enough to Retire, No Matter What,” a number of financial advisors provided advice on how to work with clients to prepare them for retirement. To no surprise, advisors recognize that many of their clients are “nervous about running out of money.” However, none talked about income-generating annuities—the one solution that ensures a client will have a stream of guaranteed income that will last their lifetime.”
21 APR – Allison Bell – Think Advisor
Annuity Guaranty Paper Gets State Regulators’ Attention
“A National Association of Insurance Commissioners publication has news for state insurance regulators: They may have succeeded at hiding the existence of the life insurance and annuity guaranty system from annuity buyers.
The NAIC’s Journal of Insurance Regulation is informing regulators of that possibility by publishing a paper assessing consumers’ awareness of state insurance guaranty protections.”
24 APR – Greg Iacurci – CNBC
Retirees are thinking of annuities the wrong way — and it may trip them up, advisors say
“People saving for retirement have a common goal: Build an adequate nest egg to prevent running out of money in old age.
One way for retirees to do that is via a guaranteed stream of income they can’t outlive — one that’s deposited into their bank accounts every month for the rest of their lives, like a paycheck.
At a time when workplace pension plans have largely disappeared, annuities can serve as an alternative for retirees seeking pension-like income, according to financial planners.”
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.