The Role of Income Riders on Fixed Annuities

Insurance companies began using the term “income planning” several years ago to promote new and innovative riders on annuities. In only a few years, clients started making decisions about their advisor relationship largely on the advisor’s ability or willingness to plan for income. In the Fidelity Advisor 2006 Survey of Investors at Retirement, seven of 10 baby boomers indicated they wanted to discuss income planning. Less than four of 10, however, had an income discussion with their advisor. More important for advisors, McKinsey & Co’s “Managing Retirement Income: Innovative Strategies to Capture and Retain Retirement Income” research found that 75% of investment clients planned to add or switch advisors within 15 years of retirement. Clearly, an advisor’s ability to plan for income creates an opportunity to retain and capture new clients over the next two decades.

The Role of Income Riders on Fixed Annuities
Source: Life Insuranc Selling