Having reached what it considers its limit for sales of variable annuities that offer optional guaranteed benefits, Jackson National temporarily suspended 1035 exchange business or the transfer of qualified assets into variable annuities with those elective riders.
The time frame for the suspension period runs from 4 p.m. EST Oct. 25 to Dec. 16. The program does not apply to Jackson’s Elite Access variable annuity (VA) product or the company’s fixed or fixed indexed annuities.
Jackson National undertook a similar initiative last year to manage its sales volumes. “As part of our active risk management program, we seek to balance our guaranteed and non-guaranteed business to avoid a concentration of exposure to any single product type in any one year,” said Mike Wells, Jackson National’s president and CEO, in a statement. “The variable annuity market remains attractive for Jackson and we are committed to writing new business within our overall appetite for risk.”
Industry-wide, variable annuities that offer lifetime income benefits have caused some carriers fiscal angst of late, as those long-tail obligations have cut into reserves in a low interest rate environment. Benefit reductions and fee hikes have become somewhat commonplace and several carriers have extended buybacks offers to owners of legacy VAs in an effort to lighten the long-term commitment of lifetime guaranteed income to policyholders.