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Retirement Planning > Retirement Investing > Annuity Investing

Working With A Re-Branded Annuity

By Staff Writer

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There are ways to avoid sour reactions among advisors and clients

By Robert Holaday Jr. and Karen Wallace

For most of us, change can be an unsettling experience, especially when the change has to do with a financial product.

That is not surprising, really. Clients can put a lot of time into making careful, prudent investment decisions. So, when theres a change affecting a decision they have made already, their initial reaction can be negative.

A change in annuity brand also can generate a sour reaction among advisors. Such a change can mean the advisor not only needs to learn new products, benefits and applications but also to develop new wholesaler and sales desk contacts, business processes and protocol. Add the need to communicate the change to clientswhat it is, why its important, and what they should doplus allow time and effort it will take to do all this, and the stress points become obvious.

What do we mean by brand? Brand is the promise or value you expect to get from the product or service. Disneys promise is family fun and entertainment. Nikes value is superior athletic performance.

Lets establish what is important to clients about a brand when considering an annuity solution. There are 3 things clients want to know about the provider brand: How long have they been around? How able are they to make good on their promises? And, have I heard of them before?

In other words, clients want information on the companys longevity, financial strength and name recognition.

After the purchase, brand is important in 2 key areas: in delivery of an accurate and exemplary quarterly statement; and in how well the company resolves any service issues with the clients. Delivering a statement that is simple to read, understand and that is always accurate is critical. In addition, a company that resolves any issue promptly, easily and with satisfaction provides a good brand experience.

Now, what annuity brand attributes are meaningful for the advisor? After providing a strong record of investment performance and convincing answers to the top 3 client questions, a good annuity brand provides a range of product solutions and competitive benefits to meet a variety of specific client needs.

Critical to advisor perception of the brand are the people who deliver the product. A wholesaler that listens well, responds with value to advisor needs, and provides relevant tools and information adds to the brand image. The top annuity brands provide continuing education, sales ideas and case studies. Finally, premier annuity brands have compelling, client-approved brochures that clearly and simply articulate how their products meet investor needs.

Lets return to the issue of being presented with a re-branded annuity. There are several ways advisors can help themselves and their clients deal with a re-branded annuity.

Starting with the advisor, say the re-branded annuity means dramatic change in wholesalers, process and product. If so, there must be a really good reason for the product solutionrecord of performance, investment options, range of benefits at reasonable fees, etc. Hence, the time building a relationship will likely be worthwhile.

Therefore, give the new wholesaler and sales desk associate a chance to tell their stories. Let your new contacts know what works well with your other or previous relationships and ask for a reference. Spend some time learning about the extent of the new brands solution offering and support, including sales proposals, continuing education and communication programs. Make sure to look at their sample statements so you know how to answer any questions clients might have on this.

If, after careful review, you believe you can meet your clients needs better with the new offering, then a brand change can be a competitive advantage and can mean the opportunity to build your business.

But be wary of brands touting only the “latest and greatest.” Youll have greater success working with a company and a person that you trust will be around than with brands promising hot features but no staying power.

For the client, remember that an annuity can include a number of insurance options that require careful consideration and planning. Therefore, any substantive change affecting the new policyfees, surrender and withdrawal terms, to name a fewnecessitates direct communication with the client. Keeping the communication simple yields the best results.

First, point out what matters most: the improvements and how it fits with the clients personal investment strategy. Second, establish why you believe in the new brandproduct, longevity and financial strength are good places to start. Both the type of change and the nature of your relationship with your client will dictate whether a letter, e-mail, or a face-to-face meeting is appropriate.

Stay current with new rules affecting written communication with clients.

Favor face-to-face meetings with clients. Use brochures with the new brand name if they state simply how the benefit of the product meets the clients specific needs. Finally, meeting with clients to discuss a change in their annuity solution is a great opportunity to see if your clients have had any life events that require a strategy shift and new solutions.

With change comes responsibilityand opportunity. It takes a while to learn about a new or changed annuity brand and products. But if the result is increased ability to build solutions that better meet client needs, then it is a change to embrace.

Robert Holaday, Jr. is a Registered Principal for Royal Alliance Associates, Inc. in La Mesa, Calif. His e-mail address is [email protected]. Karen Wallace is assistant vice president-Annuity Market Center for Sun Life Financial U.S. in Wellesley Hills, Mass. Her e-mail address is [email protected].

Reproduced from National Underwriter Edition, October 1, 2004. Copyright 2004 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.

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