What Do You Guys Think About Apollo Global Management Buying Aviva and Guggenheim Buying Equitrust?

[Benzel]

I had a potential client that did research on Equitrust pose this topic to me,stating they were ready to buy a EIA but after reading that article in the Des Moines Register they feel like all insurance companies are unsafe and invest aggressively. I pointed out that most insurance companies do not invest aggressively and these two in addition to sun life are the only companies that was owned by either hedge funds or an private equity based company. Also in Florida the department of financial services insures contracts with individual companies up to $250,000. Any advice on where to head with this sale and how to assure the client about the safety of insurance companies and or how they invest their money?

 

[nathan.lee]

I had a potential client that did research on Equitrust pose this topic to me,stating they were ready to buy a EIA but after reading that article in the Des Moines Register they feel like all insurance companies are unsafe and invest aggressively. I pointed out that most insurance companies do not invest aggressively and these two in addition to sun life are the only companies that was owned by either hedge funds or an private equity based company. Also in Florida the department of financial services insures contracts with individual companies up to $250,000. Any advice on where to head with this sale and how to assure the client about the safety of insurance companies and or how they invest their money?

Actually the number of insurance carriers in the FIA space that are owned by Hedge Funds or Private Equity Groups is up around 30%. Should a client be concerned about that? Only time will tell.

The positive for you and the client is that 70% of insurance carriers are NOT owned by Hedge Funds or Private Equity Groups. Many carriers have financial reports with a breakdown of their investments available upon request.

Also, take a moment to read my friend Stan the Annuity Man's article on this very subject.

http://blog.annuity123.com/should-i-be-concerned-that-a-hedge-fund-owns-an-annuity-company/

Good luck!

 

[Justin Bilyj]

Considering its an arm of Goldman Sachs, you come to your own conclusions...

 

[Larry Tew]

I know Jackson doesn't have all the bright shiny objects in their FIA line that some of the others have, but they sure paint a stable picture compared to some of the others.

A client may not ask about that, but it matters to me.

 

[Benzel]

Thank you Mr.Lee I appreciate the reference as well.