Small Annuity Recommendation from the Pros

[pbbaseball]

Hey guys, had a customer, about a 16k annuity. Will be an IRA rollover. She just turned 70.5, doesn't want to outlive her money, and has had to start taking RMD's.

Originally I wrote her with Phoenix, but they declined it based on suitability. They wanted to see an additional 50k liquid, but she only has 25k liquid. Net worth is about 75k, they get 29k yr in income, with no debt. Has a med supp, so shouldn't have unexpected medical bills.

Her goal is to get the maximum lifetime payout, but still be able to leave the remaining money to her spouse if she dies prematurely. My backup product that I'm looking at is Aviva, which will give her about $78 in monthly income, and will have death benefits until she's 87 assuming no growth.

She's not too concerned about growth, but wants immediate income. She's been a medicare customer of mine for a while, so I want to do the best thing for her.

Thanks for the help!

 

[nathan.lee]

The Allianz MasterDex 5 Plus should be able to get her approx. $77 per month.

American National's Strategy 7 with income rider would get her about $80 per month.

Aviva's Income Preferred Bonus with Income Edge Plus rider will get her about $74 per month.

A SPIA with a 20 yr. certain payout would net her about $92 per month. Obvious downside is if they outlive the 20 yrs. or she passed early and the husband wants a lump sum and not the income.

Hope this helps.

 

[pbbaseball]

thanks a bunch Nathan!

 

[TheAnnuityGuru]

The Allianz MasterDex 5 Plus should be able to get her approx. $77 per month.

American National's Strategy 7 with income rider would get her about $80 per month.

Aviva's Income Preferred Bonus with Income Edge Plus rider will get her about $74 per month.

A SPIA with a 20 yr. certain payout would net her about $92 per month. Obvious downside is if they outlive the 20 yrs. or she passed early and the husband wants a lump sum and not the income.

Hope this helps.

This case will definetly be declined by Allianz as it doesn't meet many of their suitability requirements. Aviva is also likely a decline. Not sure about ANICO. Honestly given the client's financial details this is likely to have a tough time with any carrier's suitability process as it raises several red flags (less than $50k liquid, less than $100k total net-worth, 65+) Generally speaking this is really just not a potential annuity client given the financial limitations.

 

[iceco1d]

Joint life SPIA and forget about it. What's the husband's age?

 

[nathan.lee]

This case will definetly be declined by Allianz as it doesn't meet many of their suitability requirements. Aviva is also likely a decline. Not sure about ANICO. Honestly given the client's financial details this is likely to have a tough time with any carrier's suitability process as it raises several red flags (less than $50k liquid, less than $100k total net-worth, 65+) Generally speaking this is really just not a potential annuity client given the financial limitations.

Guru,

I tend to agree with you on the suitability aspect of this case. I'm not too sure how many carriers will accept this given the financials. My intent was to stay out of the suitability discussion in case there were other factors that we aren't aware of and just give him the payout numbers.

Given that they are already receiving approx. $2,416/month with no debt, I'm not sure if an extra $70 or $80 per month would be worth losing half of their liquid assets. IMHO

 

[TheAnnuityGuru]

Guru,

I tend to agree with you on the suitability aspect of this case. I'm not too sure how many carriers will accept this given the financials. My intent was to stay out of the suitability discussion in case there were other factors that we aren't aware of and just give him the payout numbers.

Given that they are already receiving approx. $2,416/month with no debt, I'm not sure if an extra $70 or $80 per month would be worth losing half of their liquid assets. IMHO

Agreed. I mentioned the suitability only because the OP specificially mentioned the fact the case was denied by Phonenix due to suitablity issues.