Achaean Teams With Insurer to Create an Inflation-Friendly Income Annuity
Sammons and Nationwide have also announced income tool updates.
Achaean Financial wants to offer your clients another way to create a lifetime stream of retirement income.
The Lake Forest, Illinois-based financial products developer is joining with National Western Life Insurance Co, to create a single-premium immediate annuity, or SPIA, that will include a patented type of income increase feature that may help a retiree cope with inflation.
The companies hope to bring a new SPIA based on Achaen’s Income Plus+ concept by Sept. 30.
What It Means
Life and annuity product designers know your clients are clamoring for inflation protection. They’re working on it.
The Achaean Product
A SPIA is a product that can convert one large premium payment into a stream of lifetime income.
Achaean says it has come up with a way for a SPIA to accumulate extra value in good years and use the extra value to boost income payments.
Achaean has been marketing the rider for about a decade.
Achaean is led by Lorry Stensrud, a former CEO of Lincoln Financial’s Lincoln Retirement division.
Another executive on the Achaean team, Lawrence Ryan, the executive vice president, worked in derivatives at Merrill Lynch, Prudential and UBS before moving to Praetorian Advisors. Many modern annuity managers depend heavily on derivatives arrangements to crediting rate option menus and manage product risk.
National Western Life Insurance, the company that has agreed to issue the new product, is an arm of Austin, Texas-based National Western Life Group. The group ended the third quarter with about $14 billion in assets.
Other Annuity Product Announcements
Midland Retirement Distributors, an arm of Sammons Financial Group, is introducing the Summit Focus 3 annuity contract.
The contract is a three-year non-variable indexed annuity.
Midland is issuing the annuity through Midland National Life Insurance Co.
The new contract is aimed at clients who need a short-term solution, or more potential income growth than a traditional non-variable indexed annuity might offer, the company says.
Nationwide is increasing the payout percentage rates available through the Nationwide Lifetime Income Rider+ variable annuity riders.
For the Nationwide Lifetime Income Rider+ Max rider, for example, the change will increase the roll-up rate to 7%, from 5.5%, the company says.
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