Annuity Index War May Reveal a Data Gap
May 21, 2019 by Allison Bell
One challenge for consumers thinking about buying indexed annuities may be the lack of well-known, accessible tools for comparing the performance of various investment indexes, or even knowing which of the indexes have been around for 10, 15 or 20 years.
The Center for Economic Justice — an Austin, Texas-based group that’s skeptical of use of newer investment indexes in indexed products — raises questions about index information availability in a comment letter sent to the National Association of Insurance Commissioners’ Annuity Disclosure Working Group.
Annuity issuers have asked regulators to let them illustrate the performance of indexes that have been around for less than 10 years, especially when the indexes are made up of other indexes that have been around for at least 10 years.
The center has included an article from Sheryl Moore of Wink Inc. about indexed product indexes. Moore provided a list of 90 indexes that are available with indexed annuities today. She noted that [at the timing of the request she was out due to death in the family and was unable to quickly indicate] which of the indexes on the list were at least 10 years old, or at least 20 years old.
Links to a copy of the Centers for Economic Justice comment letter and other Annuity Disclosure Working Group resources are available here.