Prudential to End Sales of Variable Annuities With Guaranteed Living Benefits

[Allen Trent]

I think it's just the riders... but without those riders, why would someone want to buy a variable annuity? Sure, you can annuitize it at any time, but I wouldn't want it.

Only reason I can think of would be the same reason variable life still had a market. High income clients wanting tax deferral & connection to stock market like returns without the caps. But, those same clients might fare better tax wise buying ETFs or index funds & having gains tax at better capital gains rates & step up basis at death compared to ordinary income tax rates for lifetime withdrawals & ordinary income tax to heirs at death.........but who knows how long favorable capital gains rates & step up basis will last going forward.

 

[Allen Trent]

The headline indicates its just Income Rider sales. Is it all VAs?

I have been told it is all VA they stopped, not just income riders.

However, I think it could be connected to the fact they introduced 6 months ago an Indexed Variable Annuity (Flexguard) product that has over 1B in sales in less than 6 months.

So, they still have this new VA, but it is only an Index Variable Annuity,