“I think all the financial turmoil we’ve seen lately is actually going to spur growth in the variable annuity space,” says Scott DeMonte, who follows the VA market for Massachusetts-based Financial Research Corp. DeMonte, the former owner of annuityIQ.com, an information clearinghouse for the VA market, says his advisor contacts were seeing a rise in demand for variable annuities in the immediate wake of the financial crisis. “They’re telling me more clients are asking about variable annuities specifically because of the guarantees attached to them. [VAs] can’t guarantee against losses in account value, obviously. But they can guarantee things like income for life.”
Even on the heels of record-breaking stock market losses, Tom Mullen, who leads the VA marketing effort for John Hancock, managed to summon optimism. “The thing that keeps me positive,” he says, “is that there are 76 million Baby Boomers, most of whom will find the guarantees offered by annuities appealing.”