Big-name annuity sellers have finally landed on the Envestnet wealth management platform, but will that be enough for nudge advisors toward annuities?
For young advisors entering the industry for the first time and doing so in a fiduciary era, Envestnet’s Insurance Exchange is a huge leap forward, said Dev Ganguly, chief information officer at Jackson National, which joined the exchange last week.
The integration of annuities into wealth management amounts to “reimagining the experience end to end for the advisor that has never sold the annuity before,” Ganguly said.
The platform is designed to help advisors from a need-specific versus a product-specific perspective, so as to steer client discussions toward protecting income and then searching for a solution by entering the parameters into the software, he said.
Partnerships between Envestnet other platforms mean that advisors will have access to other annuity products that may not be listed on Envestnet’s insurance exchange.
“The whole world is a platform,” Ganguly said.
For established financial advisors with a book of business 30 or 40 years in the making and comfortable with the way they’ve done business, the changes will be welcome even if they amount to incremental improvement in a daily routine.
But there’s no question that no matter how long an advisor has been in the business, listing annuities on Envestnet represents “orders of magnitude” in improvement as the wealth management and insurance environments are brought together, said Ganguly.
Integration a Key Factor
For years, wealth management and insurance had developed on separate tracks.
That made it difficult to integrate the protection aspects of insurance into the broader investment arena of a retail portfolio.
But with annuities listed on the exchange, if a client is concerned about running out of money in retirement, advisors can seamlessly bring up a host of annuity products on the same screen without having to log out and re-enter into a new system with a username and password.
That may sound mundane, but think of it as having your Social Security, Medicare and a federal pension program all visible on tabs in the same browser window without have to log out and then log back in.
“Advisors really want embedded insurance and protection solutions and that's what Envestnet is bringing to the market,” said Paula Nelson, president of retirement at Global Atlantic Financial Group, in an interview earlier this year.
Global Atlantic was the first company to list annuities on the exchange, which Global Atlantic joined in late June.
Software developers have spent thousands of days coding the platform to add insurance, bank trust support, financial planning and trading functions, according to Blake Wood, senior vice president and director of product strategy at Envestnet.
Big Sellers Join
Three major annuity sellers – Global Atlantic, Allianz and Jackson – are listing annuities on the exchange and that means dozens of annuity choices for the 88,000 advisors who either manage client accounts or use the network’s portfolio management software.
Allianz said its entire fleet of annuities would be made available via the exchange while Jackson said only its fee-based annuities would be available – for now. Global Atlantic will list fixed and fixed indexed annuities on the exchange first, and then add variable annuities and other registered products later.
The three companies were among the top 11 annuity companies in the U.S. in the second quarter, data tracker LIMRA Secure Retirement Institute.
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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