Add another insurer to the ranks of companies releasing fee-based fixed indexed annuities: Symetra Life Insurance.
The Bellevue, Wash.-based life insurer announced the launch of Symetra Advisory Edge and Symetra Advisory Income Edge, two fee-based fixed indexed annuities.
Advisors who sell Symetra annuities now have the traditional commission-based Edge FIA products and the fee-based Advisory Edge products.
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.
Advisory Income Edge comes with an optional guaranteed lifetime withdrawal benefit (GLWB) rider, the company said.
Fee-based FIAs are designed to make it easier for advisors sell under the Department of Labor’s fiduciary rule, key precepts of which have been delayed until July 1, 2019.
But will advisors warm to fee-based FIAs?
In time, fee-based sales will rise as advisors become more familiar with them, said consultant Howard Schneider, who regularly surveys the advisory market. For now, fee-based FIA sales remain a blip on the FIA sales screen.
Fee-Based Sales Tiny but Growing
The industry reported an estimated $21 million in fee-based indexed sales in the second quarter, double the volume from the first quarter but still a fraction of overall indexed sales, according to LIMRA Secure Retirement Institute.
FIA sales, the bulk of which fall under a commission-based transaction, will range between $50 billion and $60 billion this year, after coming off a record $58 billion in sales last year, according to market forecasts.
Second-quarter FIA sales fell nearly 6 percent to $14.6 billion compared with the year-ago period, but rose 13 percent compared to the first quarter, according to industry data tracker Wink’s Sales & Market Report.
Still, there are many more fee-based FIAs on the market now than a year ago ago, when they were almost nonexistent.
Since last August, fee-based FIAs have been launched by insurance giants Great American, Voya Financial, Allianz Life, Nationwide, Lincoln Financial, American Equity and Nationwide.
Ohio National Financial Services, which entered the FIA market for the first time earlier this year, said it has plans for a fee-based version of its ONdex FIA.
InsuranceNewsNet Senior Writer Cyril Tuohy has covered the financial services industry for more than 15 years. Cyril may be reached at [email protected]
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