Immediate variable annuity sales take off. (Life/Health).
Sales of immediate variable annuities Variable annuities
Investment contracts whose issuer pays a periodic amount linked to the investment performance of an underlying portfolio. rose sharply in 2000, but the industry is still modest in comparison with the $138 billion in traditional variable annuity Variable Annuity
An insurance contract in which, at the end of the accumulation stage, the insurance company guarantees a minimum payment. The remaining income payments can vary depending on the performance of the managed portfolio. sales reported by the Variable Annuity Research and Data Service.
As of mid-2001, only 15 companies offered immediate variable annuities, according to according to
1. As stated or indicated by; on the authority of: according to historians.
2. In keeping with: according to instructions.
3. a survey by the Diversified Services Group Inc., Wayne, Pa. But that didn't hinder the 69% increase in sales for 2000, according to VARDS. Diversified Services Group projected that sales of immediate variable annuities would total about $1.4 billion in 2001.
The 15 companies offered 17 immediate variable annuity products, and another 10 firms offered substitutes, up from five in the previous year. Substitute products included the use of deferred variable annuities converted to annuitization.
An immediate annuity immediate annuity
An annuity that is purchased with a lump sum and that begins making payments one period after the purchase. Immediate annuities are most commonly purchased by people who have accumulated a sum of money and are ready for retirement. is a product that begins payment at the end of the first prescribed pre·scribe
v. pre·scribed, pre·scrib·ing, pre·scribes
1. To set down as a rule or guide; enjoin. See Synonyms at dictate.
2. To order the use of (a medicine or other treatment). payment period. For example, if an insured buys an immediate annuity with monthly payments, benefits would commence at the end of the first month after the purchase.
According to the survey, the average immediate variable annuities product sale was $130,000, with a per-company range of $72,000 to $233,000. An average immediate variable annuity sale was 24% larger than the average substitute sale, DSG DSG Direct Shift Gearbox (Audi)
DSG Deputy Secretary General
DSG Duke Student Government (Duke University) said.
Of companies with no immediate variable annuities products, three indicated they would file for one in 2001, and 20 more said they plan to file a new product in 2002. In the 2000 survey, however, 11 companies indicated they would file in 2001, but only one of them had by late in the year, said DSG.