Annuity FYI Blog

A new partnership between Lincoln Financial Group and Humana Inc. will make it easier for consumers to purchase fixed indexed annuities and long term care insurance.  According to Annuity News Journal’s article “Humana Inc. Forms Partnership with Lincoln Financial,” Henry Steelman writes that more than 2000 agents for Humana will be selling the financial products of Lincoln.  Humana Inc. is a health insurance company out of Kentucky, selling policies to consumers nationwide.  Lincoln Financial, out of Pennsysylvania, offers many different financial services around the United States.  This partnership between the two companies allows consumers nearing retirement to purchase all of their necessities in one convenient place.  They’ll be able to get health insurance as well as financial planning products from the same agent.

Lincoln Financial, traded on the NYSE as Lincoln National Corp., offers numerous annuities and insurance products to their consumers.  The financial products that will be sold through Humana are fixed indexed annuities and MoneyGuard, a form of long term care insurance.  As the cost for long term care increases dramatically, insurance to protect against that expense becomes more important than ever.  Between long term care insurance and annuities to cover basic living expenses in retirement, Humana believes that they are offering their consumers important products to complement their health insurance.  They don’t think there is much more important than protecting yourself with health insurance and the proper finances to carry you through life.  Since many consumers don’t have a financial advisor, having these products available through their health insurance company allows consumers access to financial products they may not have seen before.

According to a press release from State Street Global Advisors, they will now be working closely with Lincoln Financial Group’s variable life and annuity business.  In “State Street Global Advisors Expands Innovation within Lincoln Financial Group’s Variable Life and Annuity Solutions,” we learn that the investment management business will sub-advise Lincoln’s variable investment options.  Lincoln’s new Variable Insurance Product uses many exchange traded funds that are currently part of State Street’s fund management.  Eight different variable annuity ETF’s sub-advised by State Street and currently offered by Lincoln are used along with State Street’s SPDR(R) ETF’s.

Lincoln is excited to offer their investment clients sophisticated options in the insurance industry, including what they view as some of the best annuities.  August 2 was the date that State Street took over as Lincoln’s sub-advisor.  Since ETF’s have a relatively low cost and many trading and other benefits, their demand in the variable life and annuity business has been increasingly high.  State Street focuses on clients when determining solutions and believes that their partnership with the innovative Lincoln Financial will not only help financial advisors, but investors as well.  Both companies are hopeful that this new partnership will grow their businesses and keep their clients moving in the right direction.

National Retirement Planning Week will take place from April 12-15, according to Lincoln Financial’s press release “Lincoln Financial Group Joins Effort to Raise Awareness About the Critical Importance of Retirement Planning.”  Lincoln is co-sponsoring this awareness week with the Insured Retirement Institute (IRI) to increase the public’s understanding of the importance of planning for retirement.  Whether through fixed annuities, company 401k plans, or another source, Americans need to be diligent about planning for their future income stream.  A recent study showed that more than half of Americans are at risk of losing their standard of living in retirement because they haven’t saved and financed enough.

The National Retirement Planning Coalition, headed by the IRI, sponsors National Retirement Planning Week.  They have committed to making retirement planning education a national priority so that people can “Retire on Your Terms”.  The IRI is a non-profit organization advocating for annuities, retirement planning, and insured retirement strategies.  They work to make sure that the interests of consumers, financial advisers, and the industry as a whole are meshed together.  Their partner in National Retirement Planning Week, Lincoln Financial Group, sells annuities, many kinds of insurance, and other financial planning and retirement plans.  Together they believe in fighting for the education and importance of planning for your retirement.

According to Darla Mercado of Investment News, insurance companies have new targets in their sight to increase sales of variable annuities.  Mercado’s article “Insurers target new channels to help boost VA sales” talks about the insurance companies’ plans.  At the Insured Retirement Institute’s marketing conference in New York this week, the panel spoke of their need to change direction due to the financial crisis.  Insurers are looking to reach out to different types of potential customers and advisers in previously uncharted territories.

One of the biggest groups of people who could potentially benefit from variable annuities are 401k participants and managed-money programs.  Insurers hope that pre- and post-retirees will make 401k annuity transfers and purchase variable annuities from them.  The purchase of annuities will guarantee a lifetime income stream throughout retirement.  Some new products have also come out of this need to advance with the changing economic climate.  Lincoln Financial is introducing a long-term-care rider with both their fixed and variable annuities.  Updates and changes from insurance companies are meant to help consumers in the long run.  A little competition can breed great ideas.