New York Life Insurance Company, New York, N.Y., has announced that total sales of its income annuities have exceeded $1 billion for the first time, reaching more than $1.2 billion at year-end 2008. The sales benchmark includes sales through New York Life’s career agency system of $850 million and income annuity sales through its partnered banks of $350 million. Further, sales through the company’s AARP Lifetime Income Program, which offers lifetime income annuities to AARP members, have exceeded $100 million in 2008 – a new milestone for sales of this product through AARP.
On the accumulation side, investment annuities exceeded $9 billion for the first time, driven by strong sales of deferred annuities. In the bank channel alone, the company’s sales of fixed annuities through partnered banks more than doubled to $4.6 billion for 2008, from $2 billion in 2007.
New York Life announced last month that it had appointed Senior Vice President Chris Blunt to run the new Retirement Income Security (RIS) business, which encompasses income and investment annuities, long-term care insurance, and the distribution of mutual funds.
“Over the past decade, attaining a secure retirement has been made daunting by the demise of traditional defined benefit pensions and questions surrounding Social Security,” said Mr. Blunt. “The current financial crisis has further illuminated the need for a secure retirement as millions of Americans have seen the alarming erosion of their retirement assets. New York Life has led the way in adding consumer-friendly features and benefits to our annuity products, and the enormous sales growth we’ve seen in our annuity business is an affirmation of the value consumers see in those innovations, which overcame many traditional concerns about annuities.”
A key component of retirement income security is guaranteed lifetime income. New York Life is already the market leader in income annuities, also known as fixed immediate annuities, which provide a guaranteed stream of income for the life of the annuitant. Sales of the company’s income annuities began to rise in 2004 after features were added, including:
o Changing Needs Option – an option which allows policyholders to arrange for their payments to increase up to five times the original amount, or decrease by one half, should their retirement needs change.
o Payment Acceleration – the ability to accelerate some payments to meet short-term liquidity needs;