People seldom look for financial products. What they want is not another product, but a solution to meet a need.
In fact, a study of the high-income market done by our company shows that even America’s most successful professionals lack knowledge about annuities and other key products but desire solutions for managing income in retirement and estate planning.
Investment professionals sell these solutions, which come when product and advice are packaged together to help clients better achieve their personal financial goals. That includes the packaging of riders, too.
Lets see how this approach plays out in the marketplace.
Financial services products, particularly annuities, increasingly face the danger of becoming commodities within the market.
But innovative product providers are finding ways to help investment professionals better serve their clients’ needs. If that didn’t already make good business sense, the Securities and Exchange Commission also has made clear in recent months that providing annuities is really about helping clients make the best investment and savings choices, not just selling a product.
Flexible product design helps investment professionals in this by ensuring that their clients can choose and pay only for the options that work best for them.
Take variable annuities, for example. They provide this flexibility through riders. In the past, annuities were designed with mostly static features that could not be altered. Whether you needed, used or planned to use a specific feature had no bearing on whether or not you would pay for that feature.