Allianz Life Insurance Company of North America, already a major player in the indexed-annuity arena, is looking to grab a bigger share of the indexed-life-insurance market.
Allianz Life Insurance Company of North America, already a major player in the indexed-annuity arena, is looking to grab a bigger share of the indexed-life-insurance market.
“We're currently looking specifically at indexed life,” president and chief executive Gary C. Bhojwani, president and chief executive of Allianz, said in an interview with InvestmentNews. “Indexed life is small enough where we can be focused, and when we look at the underlying expertise required to market it, it's consistent with our distribution force.”
The carrier manufactures the top-selling indexed annuity, the MasterDex X, according to researcher AnnuitySpecs.
Mr. Bhojwani said that many of the insurance agents who currently sell indexed annuities have the know-how to sell indexed life insurance effectively.
To increase its presence in the indexed-life space, Allianz will have to compete against the likes of Aviva USA and Pacific Life Insurance Co., the first and second top sellers of the product for the first quarter.
“It's a smart move for Allianz Life,” said Sheryl Moore president and chief executive of AnnuitySpecs.com. “All annuities are capital intensive, and they're not very profitable. But life insurance products can make it a better profit. Coming out of a capital anorexic environment, this is how you offset profitability.”
Allianz will continue developing its annuity line as well, Mr. Bhojwani said. Recent meetings with broker-dealer and wirehouse executives, he said, revealed that many firms' top priority is to grow annuity sales in 2010 and 2011 as advisers' center more on income planning.
The insurer in either late summer or early fall expects to release a annuity product that will address inflation. Allianz also has plans drawn up for a registered indexed annuity but won't take it to market anytime soon.
Mr. Bhojwani also noted that the company has taken a “serious” look at a hybrid annuity product with long-term-care features, but Allianz is “not at a point where we can do something about it.”
A just-released study from Allianz, “Reclaiming the Future,” revealed that people continue to be nervous about the prospect of retiring, as 92% of the 3,257 adults polled said they believe there is a “retirement crisis.” Fully 35% of the polled adults feel “totally unprepared” for retirement, but an even greater concentration — 54% — of those in their late 40s feel that way.
Making those individuals aware of annuities and their benefits begins at the adviser level, Mr. Bhojwani said.
“There's a significant effort to educate on the reality of annuities and retirement,” Mr. Bhojwani said. “We're in the business of selling annuities, but we don't want the importance of education to get lost in pushing products.”
