Annuity News

Sales of Indexed Annuities Rise and Record Projections for 2009

Turmoil from the financial crisis drives record sales in fixed annuities. Uncertainty in equity markets has fueled part of the growth. The guarantee in indexed annuities is the defining difference from variable annuities, enticing customers seeking protection against further losses. Sales of indexed annuities often go up when sales of variable annuities go down or when certificate of deposit rates — a competitor for annuities — are unfavorable, Moore said. Total 2008 indexed annuity sales were...

Vanguard Applies for Guaranteed Lifetime Withdrawal Benefit (GLWB) Rider

Vanguard is seen expanding variable annuity features with an SEC application for a guaranteed lifetime withdrawal benefit ( GLWB ). The precise cost of the rider, which can apply to one owner or joint owners, and the payout rates at various age bands were left blank in the application, although Vanguard provided an example that set the rider cost at one percent of the income base. The minimum initial payment is $5,000 and a $25 annual fee is assessed when the account value drops below $25,000...
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Owners of Variable Annuities with Living Benefits Protected from Market Storm

Certain living benefit guarantees--particularly guaranteed minimum withdrawal benefits--embedded in variable annuities have provided owners with downside protection during the recent financial market turmoil. A popular variable annuity -- the one with guaranteed “living benefits” -- may be the riskiest product ever sold by the insurance industry. Risky to the health of the insurance carriers, that is. If you bought one of these annuities, you will collect your promised, fixed, minimum income...
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