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New Fee-Based FIA from American Equity


One of the nation’s leading sellers of  fixed indexed annuities, American Equity Investment Life Holding Co., has recently announced a new guaranteed lifetime income-focused fixed indexed annuity (FIA) with fee options. According to an article from InsuranceNewsNet, the FIA will be launched next month and will be sold only through independent marketing organizations and independent agents. Sales will be commission based with fee options applying to the guaranteed lifetime income rider.

Two varieties of the FIA will be available: a bonus version and a non-bonus version. According to American Equity Chairman and CEO, John Matovina, each version, depending on the deferral period, will have two fee-based options for lifetime income. A no-fee option will also be available, providing lower lifetime income than the fee-based choices.

“This product incorporates significant input from our distribution partners, and we expect it to be well received in the market as income levels are expected to be competitive,” Matovian said in a news release.

This announcement is coming on the heels of the company’s fourth-quarter numbers report. American Equity reported fourth-quarter net income of $36.8 million, or $0.41 per share. After being adjusted for investment gains, earnings came to 82 cents per share, which exceeded Wall Street expectations. The average estimate of four analysts surveyed by Zacks Investment Research was for earnings of 68 cents per share. The annuity and insurance underwriter posted revenue of $1.2 billion in the fourth quarter, with adjusted revenue at $578 million.

American Equity has reported annual profits of $174.6 million, or $1.93 per share. Revenue was reported at $3.89 billion. Shares for the company have fallen 1.7% since the beginning of the year, however closed last week at $30.21, an increase of 17% in the last 12 months.

Written by Rachel Summit

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