Home / Investment Strategies / Criteria for Evaluating Annuities with High Performing Investment Strategies & Asset Allocation Models

When evaluating the asset allocation models and investment strategies available through variable annuities, Annuity FYI looks for a) features of the asset allocation model(s) itself; b) the quality of the core annuities to which the models may be applied; and c) the company issuing the annuities.

Criteria we measure in evaluating the asset allocation models are:

  1. Sub-accounts and asset allocation models with strong historical returns that we believe will have strong future performance.
  2. Turn-key asset allocation models to meet investor profiles ranging from conservative to aggressive, with active re-balancing.
  3. A large selection of fund sub-accounts and the ability to invest outside of a model.

Criteria we compare in evaluating the core annuities are:

  1. Outstanding features and benefits, including but not limited to living income benefits and enhanced death and estate benefits.
  2. Mortality, Expense and Administration (MEA) fees — we generally favor annuities with MEA fees of 1.15% or less.
  3. Length of surrender period — we generally favor annuities with surrender periods of 6 years or less although a longer surrender charge period may offer a potential for higher returns or more income stream that you are willing to trade off for.

Criteria we use in evaluating the insurance company issuing the annuities and riders are:

  1. High financial ratings of the issuing company (although with variable annuities your assets are held separately from the insurance company’s general accounts, the features and benefits, including all guarantees, are based on the financial strength and claims-paying ability of the issuing company and its re-insurers).
  2. Company management, customer service history, and ease of on-line account access for your convenience.

 

This web page has been reviewed for compliance.
Document reference: #1500286-3

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