One of the biggest issues for the VA industry right now is to expand its market, and the best way to do that may be to enlist advisors who don’t now sell the products, a panel of asset managers agreed during the NAVA meeting here.

Most of the recent growth in VA assets was due to market increases, not new net assets, noted Steve Scanlon, managing director for AllianceBernstein’s subadvisory services, New York, a unit of AXA S.A., Paris. One reason: a scarcity of advisors who are willing to sell VAs, he said.

Scanlon, a member of NAVA’s asset managers leadership committee, spearheaded a study of how to expand VA sales by recruiting new producers. The study interviewed advisors who currently do not sell VAs.

Another committee member, Andrew Wilmot, senior vice president, Neuberger Berman Management, reported 95% of advisors in the study had sold mutual funds in the previous 12 months, while 85% had sold stocks or bonds; 71% had sold 529 college education plans and 52% had sold separately managed accounts.

But none had sold an investment vehicle that guaranteed retirement income, such as a VA. Wilmot called that result “perplexing” in view of the finding that 95% focus on retirement planning in their work, while the same percentage also focus on income planning.

Another bewildering finding was that among advisors interested in training, 77% wanted income-planning education, yet only 19% were interested in training about insurance products, Wilmot said.

That lack of a connection between insurance and income planning suggests the industry needs to do better at positioning its products in the minds of advisors, he argued.

“We need to explain how these products work and how they complement what they already sell,” he said.

When interviewers discussed guaranteed income products with advisors but did not specifically mention either VAs or insurance, 39% of advisors said they were “very interested” in discussing such a product with a professional, while another 26% showed a “strong” interest, and 21% a “moderate” interest. Only 14% were not at all interested in such discussions, Wilmot revealed.

Advisors who do not sell VAs cited a number of reasons for their lack of interest, with “hard to understand” being the leading reason, cited by 57%. Many complained about head-spinning jargon such as living benefit, guaranteed minimum withdrawal benefit, guaranteed minimum income benefit, guaranteed minimum accumulation benefit or guaranteed minimum death benefit, Wilmot said.

“It was hard work trying to break everything down to something my clients would understand,” according to one advisor quoted by Scanlon.

Another said of a meeting with a wholesaler, “The language was always a little intimidating. We got tired of feeling dumb.”

Among other complaints Scanlon cited was that fees were too high or that the wholesaler never asked what the advisor needed.

Michael Woods of XTF reported on what types of contact mattered most to advisors interviewed for the study.

More than 90% said that direct contact with field wholesalers and internal wholesalers were most important to them, while 70% also appreciated contact with customer service representatives and 59% valued printed communications. Only 7% cited 800 numbers with voice response as useful, while just 5% cited manufacturers’ Web sites as helpful.

“Producers need to get in front of them with something they remember,” Wood said. Yet only 7% had seen a wholesaler in the last year, and 11% had seen one in the past 2 years, Wood reported. A total of 49% either had not had a visit from a VA wholesaler in the past 5 years or couldn’t even remember the last time one visited.

As one advisor quoted by Wood said, “When a wholesaler shows that they are looking for a long-term partnership and can offer time and insight that another wholesaler can’t offer, well, that’s the wholesaler that I want to work with.”

Michael J. Gilotti, outgoing chairman of NAVA and executive vice president of Forethought Financial Services Holdings Inc., chaired the meeting.