Product changes in variable annuities are coming fast and furious as carriers attempt to cope with low interest rates by raising fees and scaling back features. Advisors, meanwhile, have their work cut out for them as they analyze all the new twists and turns in product offerings.
That was one of the takeaways of a panel discussion, “Trends in Product Development and Product Allocation Tools,” held last week at the Insured Retirement Institute’s Marketing Forum.
The problem with all the changes in VAs may be one of perception, Pettman said. The industry as a whole and advisors may be comparing today’s versions to the benefit-rich products of 2007. “They see these types of changes and it’s discouraging,” he said.
However, the average investor doesn’t have that same perspective. “They have a fundamental need and these products can still fulfill that need, particularly in this type of environment,” Pettman said.