[Note: I’m humming the theme to “The Producers” as I write this blog.]
After a long hiatus brought on by the financial melt-down and several years of artificially suppressed interest rates, Annuity firms are putting a toe back in the water. The industry has consolidated with many manufacturers exiting the market altogether while some of those that remain have limited the amount of annuity business they accept. Others have crafted new products to fit within the current interest rate structure such as hybrid fixed/variable products.
With new products entering the market following a long hiatus in overall annuity marketing spend, annuity manufacturers and distributers are showing signs of an Annuity Marketing Spring.
Most recently Annuity Advantage issued a press release citing research from Genworth Financial on retirement readiness in support of marketing immediate annuity products. According to that research “half of Americans will live beyond their age group’s life expectancy. With this in mind, the need for an option that includes lifetime guaranteed income becomes clear.” The study goes on to say that many near-retirees are grossly underestimating their retirement income needs, and three-quarters don’t know if their current plan includes lifetime income benefits.
While this sounds like bad news for near-retirees, the good news for business communicators is that companies like Annuity Advantage and Genworth Financial are spending money on market research, press releases and overall annuity marketing. After a long “Financial Winter” another segment of the financial industry is emerging from marketing hibernation and there is indeed a need to fill. Retirees are facing an unsettling retirement environment with retirement products and retirement tax law in flux while their traditional sources of employer funded retirement have dwindled. However, it is a difficult and complex subject to convey to investors and brokers alike so creative communicators with strong information design and plain language skills have an opportunity to shine.
With new management taking the reins at many annuity firms, now is a good time to try to connect with new management and bring new communications ideas to companies who need help to get annuities back in the minds of investors. For more background on what is driving the market today, take a look at recent research from Ernst & Young on top trends in the Annuity Market for 2014.