ANNUITY BROKERAGE
Finding the Best Annuity for Your Clients
Annuities are popular tax-deferred investment vehicles used to grow portfolio funds over time for consistent income and wealth accumulation. Some of the most popular products include multi-year guaranteed annuities, bonus annuities, indexed annuities, and single premium immediate annuities.
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When should you offer annuities to your clients?
Annuities are an ideal fit for clients nearing retirement. Outside of previously purchased life insurance policies, annuities are investment vehicles that are especially useful for those worried about running out of money post-retirement. Introducing the idea of an annuity is often as simple as asking your existing clients and new prospects what they are doing with their “safe money” – and how they envision their retirement lifestyle. If you’re wondering whether or not you can recommend annuities to a client who has not purchased life insurance, the answer is YES! Annuities are a great fit for anyone close to and planning for their retirement.
What makes annuities an effective retirement option?
As an advisor, you have the opportunity to help clients overcome their biggest fear—outliving their retirement savings. Annuities provide retirement or lifetime income, with guaranteed interest rates and index-based returns. Offering your clients better-guaranteed returns on their safe money than they would receive from a bank ensures they have income they won’t outlive.
Consider these questions when addressing the connotations associated with annuities:
- What are your clients doing with the “safe money” that they don’t want to be exposed to the market?
- What can you do to help clients overcome their number one fear?
It’s also worth noting that April and October are the two biggest months for CD renewals. Be sure to connect with your clients ahead of those months to discuss their annuity options.
Is it possible to combine different types of annuities?
Yes, your client can combine multiple annuities, and it is more beneficial to diversify both the products and carriers when combined. For example, you can have two deferred annuities where one serves as an interest rate, while another can provide an income stream. This also helps to reduce the risk of your client losing money in the event that a carrier goes out of business.
What should financial investors and insurance professionals pay attention to when looking into annuities?
Suitability is the primary thing you should be looking for when searching for annuities for your client.
The ideal client is at or near retirement, so make sure your client fits that demographic. For example, if they have $100,000 sitting in a checking account or CD, they could likely earn a higher return with an annuity.
As an annuity agent, it is important to consider your client’s assets in conjunction with the annuity and surrender charges. All annuities are going to have surrender charges, so be sure your client has other liquid assets. For example, if a client has only $60K in liquid cash, it is not suitable to lock $40K of that into a 10-year annuity with surrender charges.
Annuities can be a source of life-long income and guaranteed rates and returns, so finding a product suitable for your client is vital.
What not to do when looking into annuities for your client
The answer is simple: don’t offer annuities to clients who aren’t a good fit. Since annuities are designed for those near or in retirement, it’s best to avoid targeting younger clients. For example, annuities would not be beneficial to someone who is 40 years old because taking money out before age 59.5 comes with a financial penalty.
Why should I use a brokerage for annuities?
With so many carriers and products on the market, an annuity brokerage can help navigate the best options and find the best fit for your client. There is no added cost to the client to use a broker. At EMG Insurance Brokerage, our goal is to support advisors by simplifying the annuity marketplace and helping you identify the most suitable solutions for your clients.
How do I find the best annuity brokerage for my client?
If you are looking for an annuity broker, you can start by asking around and getting referrals. Don’t be afraid to pick up the phone and reach out to two or three of your options and begin to inquire about the details.
There are also several resources available online to aid you in your search. You can also connect with NAILBA, a leading insurance industry organization promoting consumer choice. State websites, such as the Texas Department of Insurance, are also a valuable resource.
What should I look for when speaking to an annuity brokerage agency?
- Responsiveness and Product Knowledge: Are they answering your questions clearly and promptly? Do they demonstrate knowledge of the products and solutions that fit your client’s needs?
- Back-office support: What happens after an application is submitted? A good brokerage offers strong support throughout the process—not just a good salesperson upfront.
- Test the process: Don’t be afraid to try them out with an application. If you’re not satisfied with their communication or service, you’re under no obligation to continue working with them.
- Ask all the questions: How long have you sold annuities? Have you had any annuity complaints with the state? Which carriers do you most often work with?
- Evaluate Their Recommendations: Pay attention to the carriers they work with, the financial strength ratings of those carriers, and the types of products they recommend. Are they offering what’s best for the client, or just chasing the highest commission?
How can an annuity brokerage agency help?
At EMG Insurance Brokerage, we offer the top annuity companies in the industry as well as personal recommendations and case design to enable you to best take care of your client’s unique needs. Our service offers a more personalized service compared to larger companies, and our agents are happy to walk you through the process.
What are the different types of annuities available through EMG?
We primarily focus on Fixed Annuities, which will guarantee your principal, and you will not lose money. The following products fall under the fixed annuities umbrella that are offered here at EMG.
Qualified annuities – funded by pre-tax dollars
- Deferred annuities
- Multi-year guarantees
- Indexed
- Regular fixed annuities
- Immediate annuities
Non-qualified annuities – funded by after-tax dollars
- Deferred annuities
- Multi-year guarantees
- Indexed
- Regular fixed annuities
- Immediate annuities
We have agents all over the country that we can meet virtually or in person, by appointment, to provide you with dedicated service. Connect with us by phone, online, or in person, or schedule a consultation with your sales director today on how to grow your business.
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