So this is how Rip Van Winkle must have felt!

[Tahoe Ray]

@Tahoe Ray back in the day I wrote Equitrust and American Equity (and Allianz)... what is your opinion on them now in today's market?

As @scagnt83 said, Allianz and American Equity are both extremely competitive in the market and are both solid carriers.

Equitrust has some decent products for accumulation. They occasionally pop up on the radar for MYGAs too.

That said, I tend to stay away from carriers that aren't at least A- or higher for lifetime income products. It's not like I think they're going out of business or anything, but if we're going to place a product FOR LIFE, I like to have the carrier's finances be as strong as possible.

 

[shooter]

Are annuities not a profitable item to market?
You normally don't see the big Mutual companies
advertising them.

The company rating is just one way to protect yourself
and the client.
That said, rating can change, and have done so on some big
A+ companies.

Thanks for the comments.

Shooter

 

[Tahoe Ray]

Are annuities not a profitable item to market?
You normally don't see the big Mutual companies
advertising them.

The company rating is just one way to protect yourself
and the client.
That said, rating can change, and have done so on some big
A+ companies.

Thanks for the comments.

Shooter

NY Life sells more annuities than almost anyone.

Are you familiar with the bond market?

AAA bonds pay less interest than AA and less than A etc.

At some point you get to the junk (which doesn't mean they're actually "junk")

Annuity companies can be viewed the same way. Stay in the upper echelon and you should be good. But, be aware that there are better rates from lesser companies.

Out of all of the companies you listed, Athene is the only one that I've bought a lifetime income rider from (because they are A rated and massive).

Not saying the others won't be around forever, I'm just not going to risk it for a lifetime commitment.

 

[scagnt83]

Out of all of the companies you listed, Athene is the only one that I've bought a lifetime income rider from (because they are A rated and massive).

Not saying the others won't be around forever, I'm just not going to risk it for a lifetime commitment.

Good point. Ive always felt the same, you want an A rating at minimum for a lifetime product.

But I do see a lot more risk being transferred to the client on these Income Riders vs. 5 or 10 years ago. Carriers are covering their a** in this low rate environment, and they make it seem like a shiny "new feature".

Im referring to the risk of rider growth being transferred via "index credits" on the riders. The guaranteed or base rate on the index credit option is often still fairly attractive (some are 6%-7% range + 100%-200% of index growth). But you better believe they compensate for that on the back-end with slightly lower Payout Rates... imo, at least compared to the market overall.

However, the real risk in relying on Index Credits for your Rider is the HUGE amount of wiggle room the carrier has in controlling Indexed Returns by adjusting Caps/Spreads/PRs/etc.

Adjust for Guaranteed Caps/Spreads/PRs and how will that Rider with Index Credits look??
Im not suggesting all carriers will drop them that far, I hope none of them do. But they can, do, and will drop on renewal. And carriers have only began to see the first big waves of clients triggering these riders.

If I had to generalize it, the consumer needs index return to average 5%-6% for the index option to work out better than the guaranteed rider credit option. Id even say 6%-7% just to compensate on the probable lower renewal rates. jmo

 

[Tahoe Ray]

However, the real risk in relying on Index Credits for your Rider is the HUGE amount of wiggle room the carrier has in controlling Indexed Returns by adjusting Caps/Spreads/PRs/etc.

I stay away from stacked and multipliers for this very reason.

Hope and prayers vs certainty and guarantees. I know which one I prefer.

 

[Life Hawk]

I stay away from stacked and multipliers for this very reason.

Hope and prayers vs certainty and guarantees. I know which one I prefer.

I'm a straight forward guy when it comes to Annuities. It's like using excel... the possibilities are limit less but let's face it, most of us use it for very basic stuff because we aren't programmers... most (99%) of our clients aren't programmers either... they just like the security and guarantees that an annuity offers.

Plus... the 1% that want to know all the bells an whistles before they buy fall into 2 camps, the ones who get all the information and never buy, or the ones that do buy and then become a pain in the back side... I'll give those clients to the "bell's and whistles" guys.

 

[Life Hawk]

...additional, if you sell the complexities you usually service the complexities.... hard learned experience from an young inexperienced agent... older now, got a little bit of gray hair, its either gray or gone.

 

[kpbdy99]

Nationwide's New Heights is a good product, with a great company.