Income Annuities

[agent99]

I am sort of new to the boards, but I have a few years of experience with income annuities. I am currently contracted with American Equity, RBC and Forethought.

Forethought is fine for the first few years, but the latest reduction in comp has me a little worried about its stability.

What are your opinions on Forethought and its future?

Thanks.

 

[insuranceexec]

I am sort of new to the boards, but I have a few years of experience with income annuities. I am currently contracted with American Equity, RBC and Forethought.

Forethought is fine for the first few years, but the latest reduction in comp has me a little worried about its stability.

What are your opinions on Forethought and its future?

Thanks.

I believe that Forethought is a good company, and fits a certain niche.

The problem with Forethought is that they aggressively priced the product in the beginning, hoping to attract interested agents with 10% commission. It worked.

Once they had the production and premium they wanted; they simply cut back the commission to reduce the appeal. Sound familiar!!!!!

 

[Ichiban]

I believe that Forethought is a good company, and fits a certain niche.

The problem with Forethought is that they aggressively priced the product in the beginning, hoping to attract interested agents with 10% commission. It worked.

Once they had the production and premium they wanted; they simply cut back the commission to reduce the appeal. Sound familiar!!!!!

I think they are struggling with Capital like many others so it is not unexpected that they would reduce commissions. They want to slow annuity sales right now. Same as many of the others have been including American Equity, Aviva, Equitrust.... The average commission last quarter was the lowest ever for IA sales according to a report I read.

As far as what I think of the company they are not a favorite of mine but that is just my opinion. I don't care for their strategy choices and find their bonus a smoke an mirror game but that is my personal opinion. I am sure many will disagree. They certainly have a niche as the person above pointed out.

 

[Charpress]

One thing you can say about Forethought, their high bonus product that pays low interest down the road has an interesting sweet spot. If someone is in their early sixties and is interested in turning on income soon, the big bonus works out well since the low 4% liftime rate would be what everyone else is paying for someone that young anyway.

Again, the low rate normally would blow for someone who wants to turn on income down the road. But for someone relatively young wanting income soon, it would be a good product.

 

[insuranceexec]

One thing you can say about Forethought, their high bonus product that pays low interest down the road has an interesting sweet spot. If someone is in their early sixties and is interested in turning on income soon, the big bonus works out well since the low 4% liftime rate would be what everyone else is paying for someone that young anyway.

Again, the low rate normally would blow for someone who wants to turn on income down the road. But for someone relatively young wanting income soon, it would be a good product.

Perfectly said! What other words of wisdom do you have for us?

 

[InsureGuy5]

Forethought came out of the gates swinging. As with most insurance companies, I wait about a year until using them in earnest. Here in Ohio, a regional health insurance carrier just went into liquidation. I am glad that I am not trying to move any clients around as I waited to use them.

 

[aguilartx]

Life of the Southwest is a stable company with decent bonus products and good income riders. They are known for having best renewal rates in the industry...they were given this distinction by Jack Marrion. They are also still paying 8-11% commission on their products!
Hope this helps.

 

[R. Paul Aguirre]

Life of the Southwest is a stable company with decent bonus products and good income riders. They are known for having best renewal rates in the industry...they were given this distinction by Jack Marrion. They are also still paying 8-11% commission on their products!
Hope this helps.

Yes the Secure Plus products look pretty good, we have several agents that do a lot of LSW annuity business and are very happy with them.

 

[dgoldenz]

Yes the Secure Plus products look pretty good, we have several agents that do a lot of LSW annuity business and are very happy with them.

Can you post some details on the products? What is the company's financial rating?

 

[Ichiban]

Yes the Secure Plus products look pretty good, we have several agents that do a lot of LSW annuity business and are very happy with them.

The only problem with their products is they have 2 moving parts. I like products with only 1 moving part myself. They apply both a Cap and Par rate to each strategy which is not a fun thing to need to explain...

Just my own personal bias though. I am sure some people are okay with that.