Genworth Financial Inc., providing the latest example of the life insurance industry responding to an appetite for guaranteed income products and a favorable regulatory climate, has introduced a new annuity with a lifetime income rider.
And the Richmond, Virginia-based insurer is hoping to expand its target market to include those as young as 45.
Genworth’s SecureLiving Growth with IncomeChoice annuity offers protection from market losses, growth potential greater than prevailing interest rates and guaranteed lifetime income.
The IncomeChoice rider gives contract owners the option of increasing or decreasing their payout levels once they begin drawing income at retirement. In the event of an elected adjustment, an annual charge of 1.1 percent is levied.
Genworth also has created a special provision in the annuity that allows contract holders to double the income they withdraw from the annuity for up to five years if they are confined to a medical care facility.
Last week, MetLife and Fidelity jointly announced the creation of a new variable annuity that guarantees the protection of the principal invested, which is returned after a 10-year period.
Annuity sales hit a three-year high at the end of the second quarter in 2014, according to the Insured Retirement Institute.
The $59.9 billion in sales for the period was a 6.8 percent increase from the previous quarter, and a 9.9 percent increase from the second quarter of 2013, when sales totaled $54.5 billion.
The second-quarter numbers from this year were booked before Treasury and the Department of Labor issued guidance in October allowing target-date funds in defined contribution plans to include deferred annuities to pre-retirees aged 55 or older.
Industry experts are expecting the ruling to further propel annuity sales, which signaled key regulators’ “ongoing support for making lifetime income more assessable in workplace retirement plans,” said Cathy Weatherford, CEO of the Insured Retirement Institute.