Jon L. Ten Haagen, CEO and founder of Ten Haagen Financial Services in Huntington, NY, is also taking a hard look at how some of the newer annuities might fit into his clients’ portfolios after not selling an annuities product in years.
“The market is at a 10-year high,” Haagen said. “Markets are slowing down, clients are getting older. Putting some money into annuities gets their money away from market correlation and into something that is assured by an insurance company."
Retirees will continue to drive the annuities market, according to LIMRA SRI. Less than a third of boomers aged 60 and under have access to a pension.
However, the group found that while guaranteed retirement income solutions should be growing as pre-retirees begin to think about supplementing Social Security income, income-focused annuity product sales have remained lower than accumulation-focused annuity products.
LIMRA SRI research finds there was around $30 billion paid out in guaranteed income last year through annuities.
The real star in the industry continues to be indexed annuities, which went from representing just 10 percent of sales in 2007 to almost 30 percent in 2017, Giesing said.
“The products themselves have broadened their appeal in terms of retirement principal protection, offering the potential for higher returns than traditional fixed-income solutions, as well as optional guaranteed lifetime income solutions,” he said.
“When you look at whose buying annuities, a majority of them are individuals between the ages of 56 and 70. They’re looking for that downside protection, guaranteed income or a combination of both in their retirement portfolio," he added.