By Cyril Tuohy
Top executives with the life, benefits and retirement specialist Symetra Financial believe there is more room to sell individual life insurance policies and annuities through independent broker/dealers and banks.
The company reported second quarter net income of $71.5 million, or $0.62 per diluted share, up from $45 million, or $0.34 per diluted share in the year-ago period.
Second quarter adjusted operating income of $55.3 million, or $0.48 per diluted share, up from $52.7 million, or $0.40 per share, compared to the year-ago period, the company also said.
“I see us really just at the beginning of the growth of the individual life business,” president and chief executive officer Tom Marra said in a conference call with analysts.
Second quarter sales of individual life were $9.1 million, up more than 300 percent compared to $3 million in the year-ago period, the company said.
Soaring individual life sales were due to the strong performance of universal life policies sold through an expanded network of brokerage general agencies.
Second quarter individual life pretax operating income was $13.6 million, down from $14.5 million in the year-ago period due to higher operating expenses, the company also said.
Dan Guilbert, executive vice president of Symetra’s Retirement Division, said that there was more growth for annuities sold through banks, in which Symetra already has a robust presence. “We also continue to talk to new banks, there is a lot of banks we can add new relationship and open up new product lines,” he added.
Guilbert also said that broker/dealers represent an “untapped market for fixed, particularly indexed annuities.”
“And so we are in discussions with several large broker/dealers, we plan on expanding that in the next several quarters supported by some new product work as well, particularly in the fourth quarter and early 2015,” he said in an earnings call with analysts.
Second quarter deferred annuity sales were $650.3 million, up 47 percent compared to the year-ago period, as fixed annuities and fixed index annuities benefitted from higher interest rates and expansion of the company’s bank and broker/dealer distribution network.
Income annuity sales jumped to $89 million in the second quarter, up from $45 million in the year-ago period, the company also said.
Income annuities delivered pretax adjusted operating income of $3.5 million, compared to $10 million in the year-ago quarter because of higher mortality experience, according to the company.
Cyril Tuohy is a writer based in Pennsylvania. He has covered the financial services industry for more than 15 years. Cyril may be reached at email@example.com.
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