More customers are opting to deal directly with annuity providers on websites and other digital platforms instead of advisors and agents, according to the J.D. Power 2021 U.S. Individual Annuity Study.
The study, based on responses from 2,565 individual annuity customers, found that even though advisors and insurance agents are responsible for more than three-quarters of annuity sales, customer satisfaction increasingly is being driven by direct engagement with providers.
J.D. Power said there has been a marked increase in customer engagement with provider websites and direct communications from their provider, which have helped to drive an increase in overall annuity customer satisfaction.
“The age-old perception that the advisor/agent owns the entire annuity customer relationship is no longer the case,” Robert M. Lajdziak, director of insurance intelligence at J.D. Power, said in a statement. “The current state-of-the-art for customer engagement in the annuity space is a healthy balance between advisor-led education and support and provider-led digital interaction."
Lajdziak said advisors need to up their game to continue to stay relevant in the annuity space.
In terms of individual annuity providers, New York Life took the top rank with a customer satisfaction score of 828 (on a 1,000-point scale). Nationwide ranked second with a score of 826 and Fidelity & Guaranty Life ranks third with a score of 811. The industry average was 797.
The 2021 U.S. Individual Annuity Study measures the experiences of customers of the largest annuity companies in the U.S. Overall customer satisfaction is based on performance in five factors: communication, interaction, price, product offerings and statements.
The study was fielded in June and July.