Unlocking New Opportunities With FIAs In Today’s Market
Over the past decade, we’ve seen dramatic shifts in the interest rate environment, directly impacting the performance of annuity products.
Between 2018 and 2021, historically low interest rates resulted in lower Fixed Indexed Annuity (FIA) cap rates and modest fixed interest crediting strategies.
While these products still beat the fixed rate environment with market linked growth and protected assets, the growth they provided a few years ago pails in comparison to what is on the table with todays FIAs.
Fast forward to today, and we find ourselves in a much more favorable interest rate climate. Insurance carriers have responded by offering significantly improved FIA cap rates, participation rates, and even premium bonuses—an upfront boost that increases the cash value of a contract from day one.
The Power of Premium Bonuses
One of the standout features of many modern FIAs is the premium bonus. This bonus, which can range from a few percentage points to double-digit figures, is immediately applied to the contract value. For clients who may feel locked into an underperforming FIA from the low-rate era, this presents a unique opportunity. In many cases, the premium bonus can completely offset surrender charges, allowing them to exit an old contract without financial penalty and move into a more competitive, higher-growth potential annuity.
Why This Matters for Agents and Clients
For financial professionals, this shift in the market creates an incredible opportunity to revisit clients’ existing annuity contracts. With a complimentary annuity review, you can assess whether a client’s current FIA is still serving their best interests or if transitioning to a new product could provide them with greater growth potential, better guarantees, and enhanced benefits. Not only does this help clients maximize their retirement savings, but it also generates new business opportunities for agents looking to strengthen client relationships and expand their portfolios.
Take Advantage of the Current Market
If you or your clients hold an FIA that was purchased during the low-rate years, now is the time to explore options. A strategic annuity exchange could mean more earning potential, a stronger retirement plan, and greater peace of mind.
We offer a free annuity review service to help financial professionals evaluate existing contracts and determine the best path forward for their clients. Contact us today to see how you can leverage today’s improved annuity landscape to create better outcomes for your clients — and grow your business in the process.