12.28.22
Fees Play Minor Role in Annuity Buying Decisions, LIMRA Survey Finds
by: Edward Hayes
Fees play a minimal role in a person’s decision to purchase an annuity, with the chief factor being the product's ability to generate income, according to a new LIMRA survey. Annuity sales saw a record $79.6 billion in sales in the third quarter alone, up 27% from last year, according to LIMRA. When determining whether to purchase an annuity, an investor is more focused on sustainable income, along with other factors including interest rates, principal protection and advisor recommendations, according to Bryan Hodgens, head of LIMRA Distribution and Retirement Income Research. Given the role that specific products have for investors, Hodgens said advisors should be well-informed about the variety of annuity products available. “Advisors should also be prepared to meet clients at their level of understanding about deferred annuities, which is likely to come from multiple information sources beyond the advisor,” he said. “The more advisors position annuities in an overall financial plan showing the clients the benefits of the products, the more annuities will be purchased.”
Read the full article on Financial Advisor