Annuity Sellers Sharpen Channel Focus to Gain Competitive Edge
May 12, 2025 by Warren S. Hersch
Sheryl Moore, CEO of Wink, which publishes Wink‘s Sales & Market Report, said in an email that sales drivers vary by channel. She noted, for example, that “premium banding” is more impactful in the bank channel than through distributors catering to independent agents.
Premium banding is a pricing structure where an annuity’s credited interest rate varies based on the amount of premium paid. A premium of less than $100,000 might earn one interest rate, whereas $100,000 or more could qualify for a higher rate, Moore said.
Similarly, she added, hybrid indices are commonly used in independent agent distribution — including field marketing organizations and brokerage general agencies that serve independent agents — but don’t sway annuity sales as much through banks.
Used within fixed-indexed annuities and registered index-linked annuities, these bespoke indices combine multiple asset classes, market signals, or risk-control strategies. They aim to generate more stable, consistent returns than conventional benchmarks like the S&P 500, particularly in varying market conditions.
The independent agent channel is also distinguished by the high level of product innovation in the segment, Moore said.
“Lately, we’ve seen innovations including a ‘volatility’ indexing method that hopes to smooth the highs/lows of the market, companies guaranteeing indexed annuity rates for the surrender charge period, and bonuses that are credited if no penalty-free withdrawals are taken on the contract,” she said.
Read via Life Annuity Specialist
