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The MYGA space has finally stabilized a little bit, FIAs are more popular than ever, and I share our Top 3 products sold. Here is your quarterly annuity update from yours truly!
MYGAs Are Stabilizing
We feel like the MYGA space is finally starting to stabilize a little bit. We even saw a few carriers with a modest increase in their 5-year rates. Sentinel and ACL came up from 2.8% to 3% (before any riders are attached).
Really, all of the carriers have remained constant – I haven't seen any decreases, and that's a very positive sign.
The Year of Fixed Index Annuities (FIAs)
We've had a great year so far in the Fixed Index Annuity (FIA) space. We have a lot of agents that are getting very comfortable with them.
SILAC has been the main carrier for FIAs – their products are extremely attractive, and we understand the mechanics of those products. The caps and participation rates are extremely competitive right now.
Even their fixed accounts rival the MYGA space, so there's some comfort in that. Most clients don't put much in the fixed account, but it's nice to have that option.
The overall landscape of FIAs, for us, is booming. I think it has a lot to do with agents getting comfortable and asking for that business more often.
At the same time, banks aren't giving much money, and a lot of folks are retiring early and need to do something with their 401(k)s. The Denali FIA product from SILAC offers the income rider for no fee and is a home run for that situation.
In year 2, you can start a lifetime income stream, and that's very attractive for retirees.
Top 3 Annuity Products In 2021
When we look at the annuity products and carriers agents are selling right now, 3 immediately jump out at me.
SILAC's Denali product is in 1st place by a long shot. SILAC has written $1 billion in that product, and that's a lot. It's almost half of their total production.
The Teton and Denali from SILAC are both strong products, but the Denali is a little more popular.
The Denali participation rates and caps are a little bit higher than the Teton, and the built-in lifetime income rider comes at no charge. That income rider adds flexibility so a person can utilize it down the road if they want.
The commission is the same on both products.
Another nice thing about SILAC is they have a consumer portal. Some people like accessing their account and keeping an eye on it. They can get customer forms and communicate with the company there, too. That's pretty unique.
Coming in second place is KSKJ Life's 5-Year Choice. They have everything built into their annuity line, and while their rates are a little lower, there are some really nice built-in features, like the 10% free withdrawal, full account value at death, and the nursing home waiver.
Those features are very attractive for those clients who are over age 80. They need that flexibility.
And third is Liberty Bankers Life's Single Premium Immediate Annuity (SPIA) that has gotten some attention. Their Elite series MYGA rates have also remained constant, and they offer a nice, competitive 3-year option. Their service is also outstanding, and service matters.
Trends In the Slow Season
This time of year is typically a slower time for Medicare agents, and so we see a lot of pending and incoming annuity business. Agents take this slower time of year to call on their clients and introduce to them a safe, guaranteed place to put money.
It's just a matter of consistently offering and asking existing clients if you can help them out with their money. The relationships are typically there. Take advantage of this downtime and offer another service besides just Medicare.
I always look at the market and how it's going, and I feel companies are doing pretty well. We got through COVID, and our numbers were better than they've ever been. We're not bulletproof, but it shows the resiliency of this industry.
I think our insurance carriers are incredible right now – we're independent and can get any carrier you need – but our core carriers right now are very competitive.
We truly have the best carriers for our clients. Competition can bring out your worst or your best, and I feel like it's bringing out the best in our carriers.
I think everything is stable, but we never know. The world is a crazy place, but right now, things seem solid for our annuity carriers.
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