The need to deliver a simple message and a simpler variable annuity product was a theme that threaded through the sessions of the annual meeting of the National Association for Variable Annuities.
A simple product reduces suitability problems, makes it easier for the advisor to understand, increases sales and reduces risk that features such as guarantees can create, said speakers here.
A consistent message is needed to reach consumers and consistently putting the customer first is also needed today, said John Kennedy, vice president and national sales director of the brokerage division at PLANCO, a unit of Hartford Life Insurance Company, Hartford, Conn.
“Brand is important and there is no question that we use it to our advantage,” said Kennedy of Hartfords trademark stag logo. For advisors, he said, brand can help eliminate one of the steps in the sales process.
But, he noted, success goes beyond brand recognition since “there are companies that do not have the best brand but still do a boatload of business.” Success, he said, is tied to offering products that serve the customer and not simply because they are currently popular items to offer in the market.
Making it simpler for the advisor to sell is evident in one of the top selling variable annuity products on the market, says Jeffrey Oster, a registered principal and branch manager with Raymond James Financial Services, San Francisco. The chassis of this product has not changed in the last 10 years, he said, making it easier for advisors to sell the product and note any feature changes. That understanding of the product has contributed to its long-term success, he added.
Companies should avoid taking the approach of Ill offer you a GMDB and raise you a GMWB, said David Zander, a principal of Achaean Financial, Fort Wayne, Ind. Rather, he continued, a company should deliver a message and product that sets the company apart. Referring to the law of the Yukon, Zander said, “If you are not the lead dog, the view is the same.”