Nationwide and SILAC Insurance Company are trying new index ideas to stand out from the competition.
Nationwide is creating a registered index-linked annuity that will offer indexing strategies tied to the performance of an actively managed mutual fund.
SILAC, a smaller insurer, plans to add a new multi-asset index from Bloomberg to its fixed indexed annuities.
What it means: The recent volatility of the S&P 500 may be providing the most powerful possible marketing support for annuities.
But the issuers are doing what they can to get a little extra attention.
Nationwide: Nationwide is working with Annexus, a product design firm, and Capital Group, an investment manager, to put indexing strategies tied to the performance of the American Funds Growth Fund of America mutual fund inside the Nationwide Defined Protection Annuity 2.0 RILA contract.
Nationwide believes the RILA will be the first one to include strategies linked to the performance of an actively managed mutual fund, rather than to the performance of an index fund or an exchange-traded fund.
Managers of the fund invest in growth stocks, cyclical companies and companies that now have problems but look as if they could turn themselves around.
SILAC: SILAC has licensed use of the new Bloomberg Versa 10 Index.
A strategy tied to the index can help an annuity contract holder tie the crediting rate for the annuity to the performance of gold, U.S. Treasurys and the U.S. dollar, as well as the performance of U.S. stocks.
Bloomberg developed the index together with RBC Capital Markets and Salt Financial.
The backdrop: Annuity marketers are pointing out that retirement savers were already more interested in annuities with buffers or value guarantees even before President Donald Trump put stock prices on a roller coaster April 3, by unveiling a new framework for tariffs, or import taxes.
The percentage of U.S. consumers ages 18 and older who said they thought "another big market crash" was on the horizon increased to 51% in February, from late 2024, according to survey results released by Allianz Life. The sample included 1,004 people.
Roughly 91% of the 504 annuity producers who participated in a Nationwide survey in September 2024 said they think annuities protect clients against market volatility, and 54% said they were looking for guides for clients that could emphasize how annuities can serve as a source of guaranteed income.
Annuity distributors emphasized that, for now, annuities with rate guarantees are still offering relatively high rates.
RetireOne said it could offer financial professionals and their clients multi-year guaranteed annuities with rates as high as 6.05%.
New Horizons said one of its issuers recently increased the rate available through a five-year MYGA contract to 5.45%, from 5.4%.
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