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Home > Financial Press Releases > Multiple Consumer Needs Lead to More Product Choices in the Retirement Income Market
Multiple Consumer Needs Lead to More Product Choices in the Retirement Income Market
WAYNE, Pa., Dec. 5 /PRNewswire/ -- The Diversified Services Group, Inc.
(DSG) announced the release of its 2007 Retirement Income Products Study,
the 8th annual report in this series. The report includes the findings from
two separate, but complementary, research efforts: a survey of 43 providers
of retirement income products and solutions, and a series of 21 in-depth
interviews with selected executives who focus on the retirement income
market.
According to Robert F. Vickery, a Principal in DSG's Retirement
Practice, "As we predicted in last year's study, variable annuities with
guaranteed minimum withdrawal benefits (GMWBs), particularly those with
lifetime income options, have continued with their amazing growth and
innovation. At the same time, we're also seeing expanded interest in
'alternative' products such as life insurance or annuities with long term
care riders or longevity insurance to help serve the needs of retirees.
Combine all this with the expanding efforts of mutual fund companies, and
it's clear that the retirement income market is about to get even more
competitive."
The Study examined retirement income market activity, in order to
provide a timely view of industry results, competitive behavior, product
features and trends, and a good sense of current and future efforts to
address the retirement income market opportunity. Once again, DSG
significantly expanded this annual research to broaden the product
coverage, with particular focus on products and solutions that are gaining
ground in the retirement income market. This year's study also includes a
closer look at the role of fixed immediate annuities and the surge of
activity by mutual fund companies.
Selected findings include:
-- 77% of variable annuity companies surveyed offer at least one product
with guaranteed living benefit features, with GMWBs dominating this
market.
-- Currently, 91% of respondents with GMWBs offer the lifetime income
benefit option.
-- Most executives interviewed assert that annuitization should be a key
element of most retirement income plans, and this income payout will
most often be based on a fixed immediate annuity.
-- Mutual fund companies will become a growing factor in the retirement
income market, and perhaps the greatest challenge to insurance company
penetration of this market.
-- Industry-wide sales of immediate variable annuity (IVA) products have
reversed their downward trend for the first time in 5 years, despite
the fact that only 9 out of 16 IVA providers are actively marketing
their product at this time.
This retirement income products study is part of the RM2 Report Series
(TM), on the 'Retirement Management Market' These reports focus on issues
that firms face as they develop services, products and marketing
initiatives to reach individuals and compete at and after the Retirement
Inflexion Point(TM).
DSG is a multi-disciplined firm that provides consulting, research,
information and sales executive development to the financial services
industry. The Retirement Practice provides counsel on the Retirement Income
Distribution and Assets Management Market.
SOURCE The Diversified Services Group, Inc.
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