Fidelity VA slow to catch on with fee-based advisers

Fidelity VA slow to catch on with fee-based advisers
Group still 'kicking the tires' on MetLife annuity; offering is popular with firm's reps, however
FEB 17, 2011
The popular variable annuity released by Fidelity Investments with MetLife Inc. appears to have caught on more with Fidelity's representatives than with its fee-based adviser force. Last year's total sales of the MetLife Growth and Guaranteed Income variable annuity added up to more than $1 billion. This simplified VA comes with a built in 4% to 6% guaranteed lifetime withdrawal and offers only one fund, the Fidelity VIP FundsManager 60% portfolio. The MGGI variable annuity is one of two VA options available at Fidelity, which offers the Fidelity Personal Retirement Annuity as well. The FPRA brought in more than $1.5 billion in sales last year. Both products are on the cheap side, and neither pays a commission. The FPRA costs 25 basis points for accounts below $1 million and 10 basis points for accounts over that threshold. Meanwhile, the MetLife annuity has an all-in cost of 1.9% for a single life and 2.05% for joint coverage. Sales of the MetLife product by fee-based advisers didn't account for a substantial portion of sales in 2010, said Jeff Cimini, president of Fidelity Investments Life Insurance Co. “They're still kind of kicking the tires,” Mr. Cimini said of the fee-based advisers. “We have long term hopes that this is something that aligns very well with the fee-based advisers.”

Latest News

Why fixed income still belongs in your clients' portfolios
Why fixed income still belongs in your clients' portfolios

In an era of AI euphoria and market FOMO, getting back to basics with fixed income may be the most contrarian and most important move advisors can make.

Voya expands advisor managed accounts to add private market assets
Voya expands advisor managed accounts to add private market assets

Voya Financial adds private equity, credit and real estate options to its AMA program, building on support for looser federal investment rules in retirement accounts.

With executives leaving, Osaic’s Reid now in the spotlight
With executives leaving, Osaic’s Reid now in the spotlight

Shannon Reid, president of Osaic and the network’s number two executive, has plenty of challenges, industry executives said.

Investors sue crypto fund and platform, alleging $1.5 million never returned
Investors sue crypto fund and platform, alleging $1.5 million never returned

Auditors flagged the commingling. The COO allegedly knew. Investors kept getting the pitch

Wells Fargo nabs $1.7B RBC advisor team, loses two teams to LPL
Wells Fargo nabs $1.7B RBC advisor team, loses two teams to LPL

The advisors on the move include two brothers leading a family practice in Connecticut, and a husband-and-wife tandem working with business owners in the West Coast.

SPONSORED Who builds the income when the pension disappears?

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

SPONSORED Why direct indexing stopped being optional

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.