Registered Index Linked Annuity (RILA) - License required?

[XYZ99qq]

Registered indexed linked annuities (RILAs) are growing in popularity.

They're like a cross between a variable annuity and an indexed annuity. They have a little more upside and downside than an indexed annuity, but not as much as a variable annuity.

Because you can lose some principal with a RILA, I'm assuming you need a securities license (7 or 6/63) just like for a variable annuity.

You can't sell a RILA with just an insurance license.

Is this correct?

 

[Allen Trent]

You can't sell a RILA with just an insurance license.

Is this correct?

correct, they are a form of Variable Annuity. Main difference is RILA dont have sub accounts to choose from like a traditional Variable Annuity & instead are linked to a change in an index with selected caps, floors or buffer. Some have called RILA in the past a structured or buffered annuity.

regardless, they do require securities licenses as they are registered with SEC & expose the consumer to market losses.

many of the major variable annuity manufacturers have discontinued Variable Annuities & transitioned to RILA. RILA dont have the stigma of high fees like Variable Annuities have gotten

 

[XYZ99qq]

correct, they are a form of Variable Annuity. Main difference is RILA dont have sub accounts to choose from like a traditional Variable Annuity & instead are linked to a change in an index with selected caps, floors or buffer. Some have called RILA in the past a structured or buffered annuity.

regardless, they do require securities licenses as they are registered with SEC & expose the consumer to market losses.

many of the major variable annuity manufacturers have discontinued Variable Annuities & transitioned to RILA. RILA dont have the stigma of high fees like Variable Annuities have gotten

What's a common fee structure?

Can you add a lifetime income rider to these?

 

[Allen Trent]

What's a common fee structure?

Can you add a lifetime income rider to these?

The ones I have seen have no fees or annual costs, just surrender charge schedules.

I do believe some have guaranteed income riders, but I have not investigated that component personally.

Here is a link to what I believe is one of the leading sellers of RILA currently. Lincoln Level Advantage® indexed variable annuity rate sheet | Lincoln Financial Group

At age 52 & a bit conservative, I have been investigating one for myself to minimize losses, but I have been hesitant to start a beginning index level for 3 or 5 years at today's record index highs. Unlike some FIA & IUL, I believe RILA don't have month to month index crediting strategies or dollar cost averaging to create multiple index crediting buckets.