More than half of insurance and financial professional believe that a segment of their clientele should have annuities as part of their investment portfolio, according to a new report.
The study, published by LIMRA, Windsor, Conn., says that 55% of advisors whose clients typically have less than $500,000 in investable assets believe that annuities should be included in their financial portfolios.
“Our study found that the majority of advisors feel longevity—outliving their assets—to be the greatest risk facing their clients,” says Matthew Drinkwater, associate managing director, LIMRA’s retirement research. “This is particularly true for less affluent households, who often must rely on their personal savings to generate retirement income and do not have enough assets to self-insure against longevity risk.
“Advisors consider protecting against longevity risk one of their most valuable services,” he adds. “And [they] recognize annuities provide a guaranteed lifetime income stream that will mitigate part or all of this risk for their clients.”