Selling a fixed indexed annuity (FIA) today without a guaranteed income rider is tougher than it’s ever been. Are FIAs still better than using CDs and money market accounts for accumulation of wealth? Sure. FIAs should still return 2 percent or more higher than returns of CDs and MM accounts.
However, it’s not like it used to be when annual point-to-point caps on FIAs were 8 percent to 12 percent. Annual caps now are as low as 4 percent at some
companies, and even the highest annual caps are hovering around 6 percent at many companies.
Because not every client wants a GIB rider on their FIA, I thought it was prudent to discuss the product that has the potential
for significant returns even in this low cap environment.
How would you like to use an FIA that had a return of 41.15 percent (actually credited) from March of 2009 through March of 2010? How would you like a product that, if purchased at various times from January through July (using an average of 38 different starting and ending points), averaged 15 percent as a rate of return? Yes, this is an FIA.
Marketing pitch to clients
How would you like to bet on football games the day after they were played? Would that increase your chances of winning the bet? That’s the concept behind the global lookback product.
The global lookback (GLB) product
The GLB product uses four different stock indexes to measure growth. At the end of the crediting period, the insurance company looks back at the returns of each index and weighs the return more heavily on the indexes that performed well. This Monday morning quarterbacking is something all gamblers wish they could do, and is now something those who buy FIAs can do.
What indexes are used and which ones have performed the best over the last
ten-years? S&P 500®; Dow Jones EURO STOXX 50®; Nikkei 225 Index; Hang Seng Index.
Interesting isn’t it? The S&P 500 was the best index three of the 10 years and the worst
two of the 10 years.
Are you looking for an FIA that will again allow you to talk about accumulation and not just guaranteed income riders? Then this is the product you need to learn about.
If you would like to learn specifically how this product works, please