(Dow Jones) The retirement guarantees provided by annuities are more important to investors than ever, advisors say, even as many advisors still avoid using them in clients' portfolios.

As a solution, some advisors say the insurance companies that offer annuities need to simplify their products, help educate investors and advisors and battle the perception that they are too costly.

In the wake of the recent downturn, which decimated some portfolios, investors understand the importance of annuities in a way they hadn't before, said Doug Lockwood, an independent advisor, certified financial planner and president of Harbor Lights Financial Group in Manasquan, N.J. The products "play a more important role in people's lives; they can touch it and feel it now, while they couldn't before."

Nevertheless, Lockwood says annuities aren't a major part of his business. He places clients in annuities on a case-by-case basis, using them as a diversification tool. advisors would be more comfortable using annuities if they were more streamlined and transparent, and the companies need to do a better job of explaining them, he says.

Over the years, annuity providers have worked to woo investors and advisors, designing less complex products with more flexible guarantees and introducing some lower-cost products targeted at fee-based advisors.

In April 2009, variable annuities made up 10% of advisors' assets under management on average and fixed annuities made up 3%, according to an online survey of 1,529 registered financial advisors by Cogent Research. Among all independent advisors, variable annuities made up 17% of assets under management and fixed annuities 3%. For registered investment advisors, those figures were 6% and 1%, the Cogent survey found.

Many registered investment advisors have fee-based practices, and annuities-with a handful of exceptions-are generally a commissioned product, said Lisa Plotnick, a director at Cerulli Associates.

Bruce Ferris, senior vice president of sales and distribution for Prudential Annuities, noted that his firm and others are working on low-load or no-load annuities which fit in an RIA's practice.

Ferris says his company is having a fair amount of success with annuities: In 2009, Prudential's sales of variable annuities were up 58% from 2008, and 23,000 advisors sold its products for the first time.

Still, Ferris gives the broader industry a "C" for its efforts, and says it needs to do a better job in some areas. Overall, individual annuity sales fell 22% in the fourth quarter of 2009 and 11% as compared to 2008, according to Limra International, an organization of life insurers and other financial firms.