NU Online News Service, March 24, 2004, 12:05 p.m. EST – Coventry First L.L.C., Fort Washington, Pa., has started buying consumers' unwanted variable annuities.[@@]
Coventry says the key to its new Variable Annuity Rescue program is that, as the investment value of a poorly performing variable annuity drops, the value of the death benefit can end up exceeding the investment value.
Selling a VA contract to another party might be a better deal than letting the contract lapse, because the market value of the death benefits is often higher than the surrender value, Coventry says.
U.S. consumers have more than $900 billion in variable annuities, and selling the contracts on the secondary market might end up making sense for holders of about $100 billion in VA assets, Coventry estimates.
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