Financial Advisors

Still Hate Annuities? You Shouldn’t

What I hear is: “The fees are too high. They’re complicated. There’s no transparency. There’s an insurance company involved. The back office is a nightmare. Don’t you need a separate license?”

But just like our world has changed, so have annuities. They have evolved at warp speed to meet marketplace demands for competitive pricing and ease of use, and they have a clear role with measurable value when incorporated into a household portfolio.

Annuity Leaders Are Adding To Advisors’ Tech Stack

As major tech providers integrate annuities into their platforms and work with insurance companies to simplify the process, the lingering reputation of annuities as a product sold on commission and based on features and benefits is dying quickly.

Two of the top sellers of annuities, Allianz and Jackson National, are at the forefront of a sea change. Both were among the first to integrate their offerings with tech-enabled platforms. Each has developed a robust toolbox of newly designed products coordinating financial planning, risk management, tax optimization and income generation tools to support advisors with their current tech stack and help them manage household portfolios. These insurers have partnered with the likes of eMoney, MoneyGuidePro, LifeYield, Morningstar, Riskalyze and others.

Such tech partnerships are vital for bringing transparency to annuities. Both Allianz and Jackson National have created dedicated teams to support a consultative approach where wholesalers are equipped with training and tools to help advisors determine how to improve household portfolio outcomes and capture more assets.

Annuity Pricing Matches Managed Money

One of the biggest changes in the thinking driving modern annuity products is that they’re now built to fill specific needs, not as products pushed for the sake of sales. Leading annuities are now priced to match managed money. In the right circumstances, they are a vital tool in the toolbox to create a better household-level investment portfolio for optimized accumulation and income.

Read more at FA Mag