Index Annuities Will Sell Well in 2009
January 12, 2009 - Back to Deck's Page
Index Annuities Will Sell Well in 2009
There are three simple reasons why index annuities will be favorably accepted by both advisors and clients in 2009.
First, advisors need a story that is different than what has been previously told about gathering assets from clients. Over the last few years, ETFs, variable annuities, mutual funds, etc. all had full exposure to the volatility we experienced in the stock market collapse this past year. The public is interested in securing their money. Index annuities provide a new opportunity to offer the client something they actually want to buy.
The second reason is, we have entered a low interest rate environment once again. There will be much media attention surrounding how low treasuries and CD yields are, as well as fixed mortgage rates. These low rates do not offer the solution of helping investors who have seen their account values crushed in almost every type of investment in the past year.
And third, the probability of index annuity yields hitting their maximum participation has greatly increased from one year ago. The powerful feature of annual reset allows clients to start now in measuring whether they have a positive return. For this reason, it is a fantastic time to purchase a product that stops the downside risk and features the upside opportunity from today’s pricing in the stock market.
For these three simple but powerful reasons, index annuities are a product the public wants to buy (if shown), compete extremely well against low interest rate products, and have greatly increased the probability of maximizing returns while minimizing risk.
Deck McCormick
CEO
InSource, Inc.