New York Life's Income Annuities Top $1.2 Billion in Sales

 

Saturday, Mar 07,2009, 2:50:15 PM   Click:

New York Life's Income Annuities Top $1.2 Billion in Sales Ronald J Panko
Total sales of New York Life Insurance Co. lifetime income annuities broke through the $1 billion barrier last year for the first time and exceeded $1.2 billion by year's end.

"The current financial crisis has further illuminated the need for a secure retirement as millions of Americans have seen the alarming erosion of their retirement assets," said Chris Blunt, senior vice president in retirement income security, in a statement.

New York Life's career agency system sold about $850 million of the product, also known as fixed immediate annuities. Sales through partnered banks totaled $350 million. In addition to the $1.2 billion total, the company reported selling more than $130 million in income annuity premium through a program for AARP members.

Sales of deferred annuities -- those bought for purposes of accumulation -- exceeded $9 billion for the first time. In the bank channel, sales of fixed deferred annuities more than doubled to $4.6 billion for 2008 from $2 billion in 2007.

Sales of income annuities began to soar in 2004 after the company added several features. These include options that allow policyholders to increase or decrease payments should their retirement needs change; accelerate payments to meet short-term liquidity needs; withdraw cash one time by accessing a portion of their remaining lifetime payments; increase the payments annually to guard against inflation; and guarantee a death benefit equal to a percentage of premiums no matter how long the client has been receiving income payments.

According to a Limra International sales survey, New York Life became the industry's largest income annuity seller in 2006 with total sales of $646 million and an average growth rate of more than 60%. In 2007, sales of income annuities climbed to $893 million.

New York Life Insurance Co. currently has a Best's Financial Strength Rating of A++ (Superior).

(By Ron Panko, senior associate editor, Best's Review: Ronald.Panko@ambest.com)

Copyright © 2009 A.M. Best Company, Inc. Total sales of New York Life Insurance Co. lifetime income annuities broke through the $1 billion barrier last year for the first time and exceeded $1.2 billion by year's end.