Insuring your home and car against catastrophic risk is just common sense. As a responsible owner, you pay a premium for the peace of mind that comes with eliminating risk. And at the end of the year, if your house is still standing and your car isn’t totaled, you don't complain. You’re relieved.
Along that line of thinking, there’s an annuity product concept gaining momentum called “longevity insurance,” or an “advanced life deferred annuity” (ALDA). ALDAs are designed to insure retirees against what is often their worst fear: outliving retirement savings.
Symetra Freedom Income Fixed Annuity can meet this need in a unique way, serving your clients with remarkable flexibility and extremely competitive pricing.
Advisers are well-positioned to weave Freedom Income into the retirement income story. “Your adviser might say, ‘Let’s manage your income until age 85, because the odds are you won’t live much past 85. But, just in case, we’ll take 15 percent or 20 percent of your assets and address the adverse risk of living too long,” says economist Steve Weisbart of the Insurance Information Institute of New York.
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| ALDAs typically provide clients with inflation adjusted, life-contingent income starting after age 85, in exchange for an initial investment made roughly 20 years earlier or paid over time. Freedom Income, however, is unique in that it allows investors to start receiving payouts before age 85. The flexibility to select a payment start date allows your clients to plan for specific future needs.
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| “...consumers can protect themselves against outliving their means of providing a retirement income. The comfort provided by this protection could result in a much more enjoyable retirement.” |
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Rob Stone, FSA, MAAA,
a consultant in the Indianapolis, Ind. Office of Milliman, Inc., Annuity Market News, December 2006 |
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“Freedom Income can help remove one of the biggest unknowns from a retirement-planning strategy,” says Kim McSheridan, vice president of Income Annuities for Symetra Life Insurance Co. “Your clients will be in control. They know exactly what their income will be and how long it will last. They can guarantee it for a certain period of time, or for life.”
Many clients factor current life expectancy — currently 17 years for a 65-year-old male and 20 years for a 65-year-old female, according to the National Center for Health Statistics1 — into their purchasing decisions. Because most ALDAs will not begin payout until age 85, there are concerns about living long enough to see the return of the initial investment.
For those clients who are concerned about return of premium, Freedom Income offers an optional death benefit which will return premium before payments begin and/or an installment refund option that returns premium after payments begin. Both of these options are selected at purchase. It also provides for an annual payment increase option — all the while maintaining competitive payouts for your clients.
“When you include the death benefit, annual payment increase option, and competitive payouts,” says McSheridan, “you’ve really got an attractive product.”
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