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Life Health > Life Insurance

Exec Discusses Phoenix Bank Strategy

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Despite a modest start, the Phoenix Companies, Hartford, expects banks to grow into a significant marketing channel for its financial products, an company executive says.[@@]

Phoenix has been in the bank market for over 2 years, so financial institutions have yet to become a major channel for the company, acknowledges Mark Tully, its senior vice president for annuity distribution and sales. In fact, the company’s sales in banks suffered a setback last year when it dropped its line of fixed annuities, a favorite product of bank customers, after Phoenix decided FAs were too capital intensive and unprofitable at a time of low interest rates.

The company now is building its bank strategy on variable annuities, life insurance and mutual funds.

In April, it plans to introduce a simplified version of its Edge variable universal life policy, emphasizing retirement income rather than a death benefit, Tully says. Because it would provide advisors and clients with an underwriting decision within as little as an hour or two, it should be especially attractive to banks. The product could be purchased over 5 to 7 years or funded with a single-premium immediate annuity if desired.

Phoenix currently offers 4 deferred VAs and 1 immediate VA in the bank channel. In or around June, it expects to launch a VA that will allow a great deal of flexibility in designing the product to client needs, a feature designed to appeal to the bank market. Its benefits would include changeable benefits and surrender charge periods and a choice between living or death benefits, Tully explains.

Phoenix defines its market as individuals with assets of $1 million or more, excluding the value of their residence. It sells through broker-dealers as well as banks, using 22 annuity wholesalers and 66 for life insurance.

Currently Phoenix is in 8 banks. It prefers to work with regional and community institutions, offering an assisted sales model in which the local wholesaler will sit in on advisor-client meetings if desired. Its wholesalers also offer banks a retirement seminar to advisors and their clients.

“We want to see growth from existing markets in breadth and depth,” says Tully. “We’re not looking for a lot of relationships but to drill down into existing relationships. We want more advisors working with us in existing banks, though we’re looking at adding institutions, too.”

Phoenix likes the trusted bond banks have with their clients. “They have a lot of face-to-face built in to their client relations, and that ultimately lends itself to clients buying multiple products,” Tully says.


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