Since annuities were created in ancient Rome, it seems fitting that the next step for the annuity industry is to have a collective focus revolving around the Latin word gravitas.
Merriam-Webster defines gravitas as “high seriousness (as in a person’s bearing or in the treatment of a subject)…seriousness, solemnity, or importance.” If something has substance and weightiness, then it can be described as having gravitas. Gravitas can also be described as acting in a dignified or serious demeanor.
Gravitas is one of the four Roman virtues, along with virtus (courage, character), pietas (duty, loyalty) and dignitas (dignity).
So what do I mean when I say “annuity gravitas”? I mean pride in the annuity story, and the solutions that annuities can provide. I mean understanding the importance of the potential defining role that annuities could play in America’s retirement future if we deliver the right message. I mean taking this opportunity seriously as an industry, and putting a dignified stamp on how annuities are created and sold.
Let’s look at a couple of steps toward achieving the goal of annuity gravitas.
One consistent message
I’ve written about this before, but the current “annuity message” is so disjointed and random that it would cause most ad agencies to pull their hair out. Is it growth? Is it safety? Is it income? Is it risk transfer? Is it a combination of all of these? We are creating our own confusion.
This is going to be a tough one because it seems that market growth is the impetus for most annuity sales pitches. Whether it’s variable or indexed annuities, potential market upside seems to be the dream that is sold. That is a huge mistake in my opinion.
The message should revolve around contractually guaranteed transfer of risk strategies. Boomers and retirees continue to tell us they want contractual benefits and guarantees, so let’s give it to them and tell it to them over and over. The growth story should not be part of the message. Sell the worst case scenario, and stick to that from a recommendation standpoint. Sell the guarantees only.
If we do this now, then when the next market correction happens, the public will immediately reflex to the need for contractual-type guarantees. If our message has been simple and consistent, then annuities will be where the public’s brain immediately goes to for a guaranteed solution.
Protect the brand
The industry needs to create its own “annuity neighborhood watch” program and be constantly policing each of our local areas and also national ads for anything that hurts the annuity brand. What I am talking about is a professional and consistent approach to reeling in those few annuity cowboys out there, both local and national.
We all live in areas where somebody is probably crossing the line with the annuity message, and we all know that the national TV and Internet ads continue to bamboozle the public with sizzle sales tactics, banner ads and videos. We, as an industry, have to adopt the “squeaky wheel theory” and continue to contact the state regulatory bodies and the “blind” carriers to enforce the laws and rules in place. Yes, there are regulations in place, but for some reason they are not currently enforced.
If we don’t take these proactive steps, then the annuity brand will continue to be tarnished by the few rogue agents that obviously only care about their bottom line. It took a while to shut Madoff down, so we have to be persistent until these annuity cowboys are stopped.
Leave past agendas and egos at the door
I’m talking to everyone out there, including myself. All of us “Type-A personalities” need to check our abrasiveness at the door and band together to accomplish the goal of making the word “annuity” a positive financial phrase instead of the financial curse word it has become.
There are industry leaders that I have butted heads with on some ideas, and that’s always healthy for any argument. But it’s time for all of us to sit at the table together and figure out how to win this war. Yes, it’s a war out there for the consumer’s mind and the consumer’s retirement money, and we have a product that is unmatched. When the planes hit the World Trade Center on 9/11, there were no Republicans and Democrats that day. There was no “us versus them” in America at that time. We were one country, one voice, one people.
In due respect to the victims and their families of the 9/11 tragedy, our annuity plight is obviously not in the same category. However, it is a recognizable example of taking a specific subject matter very seriously in order to win. The annuity industry is at a critical point where we are being attacked by all of the “annuity haters,” and we need to band together once and for all.
There needs to be industry meetings, focus groups, surveys, or whatever it takes to create a cohesive message and plan of action. The annuity category has a one-time opportunity to write retirement history and be the impetus for positive family lifestyles for generations to come.
We have ourselves to blame if we procrastinate once again, and this could be our last real chance to get it done.
For more from Stan Haithcock, see:
- Planning your own personal incentive trip
- How annuities can win the financial propaganda war
- The annuity industry needs its own Series 7 exam…now