The fee-based fixed indexed annuity trend rolls on as Symetra Life Insurance announces the launch of Symetra Advisory Edge and Symetra Advisory Income Edge. According to a recent news article, Advisors who sell Symetra annuities now have both the traditional commission-based Edge FIA products and the new fee-based Advisory Edge products available. Income edge products are single-premium fixed indexed deferred annuities.
“Expanding our lineup of commissionable FIAs to include these new fee-based products allows advisors and their clients to decide which planning model best suits their retirement objectives,” said Kevin Rabin, vice president of retirement products, in a news release.
An optional guaranteed lifetime withdrawal benefit (GLWB) rider is also available with the Advisory Income Edge.
In an effort to make it easier for advisors to sell annuities under the Department of Labor’s fiduciary rule, several insurers have been designing fee-base FIAs. While they’re meant to protect advisors, it isn’t clear yet whether the products will fall into favor with them. Consultant Howard Schneider, believes that fee-based sales will increase as advisors become more familiar and comfortable with them. Presently, fee-based FIA sales remain flat.
In the second quarter of this year, an estimated $21 million in fee-based indexed sales were reported. While this is double the volume sold in the first quarter, it’s still just a fraction of the overall indexed annuity sales, according to LIMRA Retirement Institute. Market forecasts predict that FIA sales will fetch between $50 billion and $60 billion this year, and that’s after a record $58 billion in sales last year. While second-quarter FIA sales actually fell (almost 6%) from the same time period last year, they rose 13% when compared to the first quarter.
It’s important to note that there are many more fee-based FIAs on the market now than a year ago, when they were almost unheard of. Since last August, fee-based fixed indexed annuity products have been launched by several big insurers, including Great American, Allianz Life, Voya Financial, Lincoln Financial, Nationwide, American Equity, and now Symetra.
Written by Rachel Summit
