Insurance companies that offer income annuities are tweaking the features and designs of the products in order to allay long-standing concerns about liquidity.
A recent study conducted by LIMRA and CANNEX, a private, independent company that facilitates the sale of financial products, found that nine of the top 10 companies offering income annuities have employed some measure to mitigate against the risk of a liquidity crisis for the consumer.
The study, “Features in Income Annuities: Immediate and Deferred Income Annuity Designs,” found that most of the income products being offered on the market today include elements that offer retirees increased access to cash should an unforeseen need arise.
Other features being added to traditionally vanilla income annuities include death benefits and flexible income options designed to keep pace with inflation. The 39 insurance companies surveyed, which comprised 84 percent of industry sales in 2012, hope that these features will make income annuities a desirable part of anyone’s portfolio.