New living benefits drive variable annuity sales.The introduction of competitive variable-annuity living-benefit guarantees in 2003 has led to significant sales increases for the industry's larger players and sales declines for most other companies unable to offer such competitive benefits, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the sixth in a series of surveys of chief financial officers conducted by consulting firm Tillinghast-Towers Perrin. Tillinghast conducted the Web-based poll last September. As a result, the market share for the top 10 VA writers grew to 67% from 60% a year earlier, Tillinghast reported. Living benefits include guaranteed minimum withdrawals, minimum accumulation benefits and minimum annuitized income benefits. Twenty-six of 70 North American North American named after North America. North American blastomycosis see North American blastomycosis. North American cattle tick see boophilusannulatus. life insurers responded to the latest survey. The vast majority (88%) also expressed concern about the cost of reinsurance The contract made between an insurance company and a third party to protect the insurance company from losses. The contract provides for the third party to pay for the loss sustained by the insurance company when the company makes a payment on the original contract. on life insurance products such as universal life, and 53% worried about a lack of capacity. More insurers are looking for Looking for In the context of general equities, this describing a buy interest in which a dealer is asked to offer stock, often involving a capital commitment. Antithesis of in touch with. alternatives to manage the risk, such as static and dynamic hedging Dynamic hedging A strategy that involves rebalancing hedge positions as market conditions change; a strategy that seeks to insure the value of a portfolio using a synthetic put option. , and to provide capital relief, such as using offshore entities and securitization Securitization The process of creating a financial instrument by combining other financial assets and then marketing them to investors. Notes: Mortgage backed securities are a perfect example of securitization. May also be spelled as "securitisation. . "Insurers are in a tough spot," said Tillinghast Principal John Fenton. "They are facing intense pressure to drive sales to meet their financial objectives, but also must manage the risks of offering attractive product guarantees." He predicted innovative guarantees would continue to be a factor in sales success. Overall, respondents were "significantly more positive" about growth in life and annuity premiums, revenue and net income for the third quarter than in prior surveys, in part reflecting the recovery in the equity markets since March 2003. |
|
||||||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion