Laurence P. Greenberg
President, Jefferson National Life Insurance Co., New York City
What Drives Him: “One: To do something that no one has done before. Two: To see the team that I’ve built do things they never thought they’d have the capacity to do.”
Jefferson National Life Insurance Company has given the controversial variable annuity an extreme product make-over. It was the sort of major challenge the firm’s innovative president, Laurence P. Greenberg, who led the launch, seeks out and relishes.
Designed to fit the fee-based model, Monument Advisor is the industry’s first VA with a flat insurance fee: $20 a month for the life of the contract — no matter how much the account grows in value. Further, Monument comes with a generous selection of more than 200 tax-deferred funds in which to invest.
“Typically, fee-based advisors, especially RIAs, said they hate annuities and would never sell them. Our challenge was to show them this is not what you normally think of as an annuity. It’s a different way to approach it. We’re trying to give variable annuities a good name because we believe the right annuity makes sense in portfolios,” says Greenberg, 47, based in New York City.
For separate accounts, the no-commission, no-rider Monument, which has neither M&E fees nor surrender charges, was developed to help fee-based and fee-and-commission-based advisors better serve clients. Jefferson launched it in 2006.
Setting new paths is what the Philadelphia-born Greenberg is all about. Previously, he was a key player in bringing to market the first nationwide online bank, TeleBank — now E*Trade Bank — driving deposits from $220 million in 1994 to more than $8 billion six years later.
“Larry has the ability to see what’s missing from the marketplace and to take a unique approach to solving issues people didn’t even know they had,” says Jack Sharry, executive vice president-strategic development of LifeYield, a provider of financial services technology.
In developing Monument, Greenberg’s main aim was to reduce costs and boost value.
“Annuities get a [bad] rap for being expensive products. [Indeed] why should someone with $25,000 or $1 million in an annuity pay more the more they save? That’s what happens with an assets-based fee,” he says.
Monument focuses on helping investors build savings tax-deferred. “Baby boomers are still accumulating retirement funds. Any benefit for tax deferral will help them — especially after what happened at the end of 2008,” says Greenberg, alluding to the global financial meltdown.
Low costs and consumer value also imbued the mindset at TeleBank, whose top management is now at Jefferson National. Chair David Smilow was TeleBank’s founder; Greenberg held the COO post. Also at TeleBank were David Lau and Michael T. Girouard, Jefferson’s COO and CIO, respectively.
When Greenberg joined as president in 2004, the life insurance carrier had just acquired Conseco’s variable annuity business. He and Smilow realized, however, that Conseco’s traditional commission-based VA was far from the best approach.