Posts Tagged ‘LIMRA’

Employers Interested in Offering Voluntary Benefits

October 21st, 2014, One Comment ».

A new LIMRA study finds that 7 in 10 employers offer voluntary benefits to improve the morale of their existing employees and attract and retain new talent.

“As the economy and the job market improve, employers are finding it more challenging to attract and retain key personnel,” said Ron Neyer, MBA, CLU, ChFC, assistant research director, LIMRA Distribution Research. “LIMRA found employers choosing to offer voluntary benefits to supplement their existing benefits package without adding to their bottom line.”

According to LIMRA voluntary benefits sales research, the voluntary market has grown in four of the past five years, averaging five percent annual gain. “Increasing medical benefits costs and the need to do more with less has made voluntary benefits an attractive option for employers,” noted Neyer.

Employers are generally happy with their voluntary benefits advisors. Six in ten feel that agents/brokers/consultants usually or always deliver on their voluntary benefit promises. Only eight percent feel that advisors rarely or never live up to their promises.
Advisor satisfaction ranks the highest at companies with 20 to 99 employees.

Post-sale support is very important to employers, the study notes. Employers prefer that their workforce receives voluntary benefits communication and service through established channels like call centers (80 percent), personalized employee statements (61 percent) and informational materials distributed at work (53 percent). Approximately half of employers consider pre-enrollment email messages to be important. Employers also consider email support even more crucial after the sale, and feel similarly about online service capabilities.

The study also uncovered how employers view mobile technology in relation to employee communication. Nearly one in four employers feel that mobile technology is very important for voluntary benefit enrollments – 38 percent say mobile access to plan information is critical after the sale. In addition, almost half (49 percent) believe post-sales live web-based support (i.e. web chat) is valuable.

“As more Millennials enter the work force, the demand for online and mobile access to their benefits will increase. Companies that stay current on these communication strategies are likely to have a competitive edge in this growing market,” Neyer said.

LIMRA surveyed 1,321 employee benefits decision makers in private firms with 10 or more employees in May and June of this year. These included 925 employers that currently offer one or more voluntary products and 396 firms that do not offer any benefit options that are 100 percent employee-paid.

For more information, visit LIMRA at www.limra.com.

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By Ayo Mseka
Editor-In-Chief

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Total Annuity Sales Improve in Second Quarter 2014

September 23rd, 2014, Comments Off.

Total U.S. annuity sales reached $61.4 billion in the second quarter of this year, improving eight percent from prior year, according to LIMRA Secure Retirement Institute. In the first six months of 2014, total U.S. annuity sales increased 10 percent, compared with sales in 2013.

“This is only the second time we have seen quarterly sales over $60 billion since the third quarter of 2011,”says Todd Giesing, senior analyst, LIMRA Secure Retirement Institute Annuity Research. “Despite declining interest rates during the first six months of this year, fixed annuity sales continue to drive overall annuity sales growth.”

Total fixed annuity sales were $25.2 billion in the second quarter, up 34 percent versus prior year. Year-to-date (YTD), fixed annuity sales equaled $49.1 billion, a 39 percent increase from 2013.

Sales of fixed rate deferred annuities (Book Value and MVA) grew 30 percent in the second quarter, compared with prior year. Fixed-rate deferred annuities reached $15.8 billion in the first half of the year, a 42 percent increase compared to last year.
Index annuity sales grew 40 percent in the second quarter, setting a new quarterly record of $13 billion. This is the first time that quarterly index annuity sales have accounted for more than 50 percent of total fixed annuity sales, with second quarter sales accounting for 52 percent of total fixed sales. YTD, indexed annuity sales grew 41 percent, totaling $24.3 billion, according to the report.

“With a record quarter of index annuity sales driven by product innovation and expansion of distribution, combined with nothing to indicate that sales will significantly drop in the near future, sales may be pushing $50 billion for 2014,” adds Giesing.
Indexed annuity guaranteed living benefits (GLBs) election rates continue to be strong, with 72 percent electing a GLB when available (four percentage points higher than in the first quarter).

Deferred income annuity (DIA) sales reached $710 million in the second quarter, 33 percent higher than prior year. In the first six months of 2014, DIAs jumped 43 percent, totaling $1.3 billion. The top three writers continue to drive most of the DIA sales, accounting for 85 percent of sales.

Growth in SPIAs

Single premium immediate annuity sales were also up 37 percent in the second quarter, to reach a record-matching $2.6 billion. LIMRA Secure Retirement Institute research shows that this is industry-wide growth — not coming from just one carrier.
Variable annuity sales fell five percent in the second quarter, totaling $36.2 billion. YTD, VAs reached $70.4 billion, a four percent drop from 2013. The researchers noted that many of the top VA sellers are focusing on diversification of their VA GLB business. In the second quarter, a few of the top companies entered the market with accumulation focused product without a GLB rider. Election rates for GLB riders, when available, were 78 percent in the second quarter of 2014.

LIMRA Secure Retirement Institute’s second-quarter U.S. Individual Annuities Sales Survey represents data from 95 percent of the market. For more information, please visit www.secureretirementinstitute.com.

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By Ayo Mseka
Editor-In-Chief

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