Clients who choose annuities as part of their financial plan may be losing confidence in the products, a new study reveals.
According to the latest J.D. Power 2025 US Individual Annuity Study, overall client satisfaction with individual annuity products has slipped by six points on a 1,000-point scale, with the weakest links revealed as digital-channel performance and the early stage of the advisor-client relationship.
Satisfaction with digital engagement dropped by 20 points year-over-year, marking it the lowest-scoring dimension in the study, while customers who had held their annuity contract for less than three years suffered a 16-point year-over-year decline.
“Today’s customers—especially those who are new to annuities—expect a level of clarity and convenience comparable to what they experience in other sectors,” says Craig Martin, executive director, global insurance intelligence at J.D. Power. “The data makes it clear that sub-par experiences early in the relationship coupled with ineffective digital tools are leading to frustration, which not only threatens customer satisfaction but also strains long-term loyalty to the annuity provider and the financial professionals selling these products.”
Another area of concern is clarity around contract terms and fees, as the percentage of clients responding that they “completely understand” annuity costs and fees dropped to 44%, down from 52%. Those saying they fully understand the contract fell to 53%, down from 58%.
The report suggests that advisors need to proactively guide newer clients through the first months of their annuity relationship, clarifying product mechanics and reinforcing their role as a trusted guide, including ensuring that the contract and fees are explained and understood.
In provider rankings, USAA retained the top spot for a second straight year with a score of 740 (out of 1000), Western & Southern Life followed at 684, then New York Life at 675.
The 2025 study is based on responses from 4,682 individual annuity customers and was fielded from August 2024 through July 2025 and includes eight core elements: trust; value for price; ability to get service; ease of doing business; people; product offerings; digital channels; and problem resolution.
Cleveland RIA grows to $68 billion in assets as Philadelphia team, deepening its high-net-worth and retirement-plan practice.
Financial planning leaders say unresolved rules on fees, Roth conversions and financial aid complicate comparisons with 529 plans.
AI can personalize at scale, but without trust, it falls flat.
Teams head for W-2 independence models with practices totaling almost $1B.
Acquisition adds 400 defined benefit plans and 1.5 million participants, pushing Empower deeper into workplace benefits.
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
Direct indexing is on pace to outgrow ETFs and mutual funds. Northern Trust's Ken Lassner explains why the advisors who get it wish they had started sooner.
