I’m a film buff.
In the course of the current Writers Guild strike, I revisited traditional motion pictures to fill the hole and was impressed by the American Movie Institute’s 100 Best Film Quotes of All Time.
Right here’s the story of the annuity trade in seven scenes, every launched by a well-known line from a film.
Seize a bowl of popcorn, sit down and benefit from the present.
1. “The stuff that goals are fabricated from.”
“The Maltese Falcon” (1941)
Present demographics are the annuity trade’s dream.
The child boomer era is growing old, and we’ll quickly expertise Peak 65, when extra Individuals flip the standard retirement age of 65 than any time in historical past.
The viewers for annuity services and products is at an all-time excessive.
The rebound in rates of interest is one other issue.
Trade assume tank LIMRA forecasts that annuity gross sales will surpass $300 billion as soon as once more in 2023, with continued development for the subsequent 4 to 5 years.
It doesn’t take Sam Spade to detect that issues are very promising.
2. “Fasten your seatbelts. It’s going to be a bumpy night time.”
“All About Eve” (1950)
Regardless of the promising forecast, the trade can’t relaxation on its laurels.
Carriers and distributors have to be ready to face obstacles like market volatility, potential business actual property foreclosures and the growing old agent inhabitants.
The rise in rates of interest that’s fueling the multiyear assured annuities momentum and the numerous enchancment in mounted index annuity phrases additionally means a resurgence in protected cash options, like certificates of deposit and cash market accounts.
Because the aggressive benefit of annuity charges narrows or disappears, some insurance coverage gross sales professionals should be taught or refresh their presentation and comparability methods.
3. “They’re right here!”
“Poltergeist” (1982)
Non-public fairness is the specter in our trade — on each the provider and distribution facet.
Whereas some dread non-public fairness, its foothold has been a supply of product innovation and technological development. And it’s prompting the trade to up its recreation.
Does it matter to policyholders if their provider is owned by non-public fairness? Maybe not.
The foundations and laws on provider conduct are common no matter possession sort.
However to some, the “ghost within the machine” is non-public fairness’s dedication to the long-term nature of the insurance coverage enterprise.
That is in distinction to the extra widespread demand for short-term outcomes.
The larger challenge is the impression of personal fairness on distribution.
Mergers and consolidations are rampant, and that impacts product growth, acquisition prices and agent entry.
All carriers — non-public equity-controlled or not — should fastidiously contemplate the foundations of engagement right here.
4. “Toto, I’ve a sense we’re not in Kansas anymore.”
“The Wizard of Oz” (1939)
The insurance coverage trade was once recognized for its geographical epicenters.
Hartford, Connecticut, and Des Moines, Iowa, come to thoughts.
That’s modified.
Product design and innovation is as more likely to come from Silicon Valley as Kansas, Iowa or Connecticut.
Distribution is remarkably decentralized at each the retail and wholesale stage.
And video conferencing, together with gross sales and annuity order entry, makes distant gross sales simpler than ever.
5. “I really feel the necessity — the necessity for velocity!”
“High Gun” (1986)
And the aggressive benefit goes to … carriers that deal with velocity to challenge and disbursement.
