Last week, LifeHealthPro and ProducersWEB co-hosted a Twitter chat with indexed annuities expert Sheryl Moore, (left) president of annuityspecs.com. You can check out the entire transcript at ProducersWEB.com.
Below, we’ve highlight some of the key topics, including booming indexed annuity (IA) sales, non-traditional competitors entering the annuity space and the 10/10 rule, just to name a few. As you look over these items, give us some feedback on what annuity topics you’d like covered in the pages.
Q1: Why are sales of indexed annuities doing so well, despite the fact that interest rates and caps are so low?
Sheryl Moore: When the market goes down, sales of IAs go up. With that in our rearview, combined with historically low rates, sales are way up!
Q2: Why are indexed life insurance caps so much higher than indexed annuity caps?
Moore: IA companies can only make a profit via a spread. IUL companies can make a profit via insurance charges, loads, spreads and more. This pricing difference accounts for why indexed annuity caps are averaging just over 3 percent and indexed life caps are averaging 12 percent.
Q3: Why do IAs get such a bad rap?