The insurance industry has been working to raise awareness around annuity products for more than a decade now.
The goal: educate consumers about their potential benefits, such as security in retirement.
(Image: LIMRA)
And, according to financial professionals, most of the clients are interested in learning about retirement income protection solutions and other benefits offered by annuity products—even if they don't ask for "annuities" by name.
However, many financial professionals admit they often avoid the conversation, or in some cases steer a client in a different direction out of convenience.
It's not that there's an aversion to annuities in the space, but an aversion to the process itself.
In some ways the industry has come a long way, but it still seems to take two steps back for every step forward—and that can mostly be blamed on a lack of innovation.
Even while individual annuity considerations increased a record-breaking 14.6% to $71.60 billion from $62.47 billion in the second quarter of 2021, according to LIMRA, there's still much opportunity being left on the table.
The LIMRA surveyed financial professionals to find out what they view as the biggest problems and barriers to growth within the traditional annuity sales process.
The Four Problems With the Process
Those who do include annuities in their offering tend to do business with no more than two to three insurance companies.
While at least they're giving clients the option to consider annuity products, the choices are limited.
What's most often holding them back from including offerings from a wider range of insurance carriers?
The process. Think: extra sign offs, piles of paperwork, hours spent on supervision.
The amount of hoops that one must jump through to sell an annuity compared to a mutual fund or an ETF is night and day.
1. No Consistency Across Carriers
If that sounds taxing, multiply those problems by the number of carriers most do business with.
If they're doing business with insurance company A, company B, and company C, they understand each company's paperwork requirements and specific processes.
They know who to call at each company and what they need to do to sell from each.
Attempting to open up an offering further to include a new carrier requires a lot of heavy lifting, especially given that there is no real consistency across carriers.
This keeps many from working with new carriers after they have a few partnerships up and running.
2. Can't Easily Integrate and Assets Held Away
Another reason that many don't typically go deeper into the annuity space or commit to expanding their annuities lineup (or why those who don't offer annuities aren't jumping in) is the simple fact that most carriers don't easily integrate into the way most do business in 2022.
For example, if they're using a wealth management platform, considering and purchasing annuities doesn't sync easily with their own process.
When it comes to annuities, the asset, in most cases, is held away from the overall account.
When a client meets for a quarterly review, the update will often be disjointed if annuities are part of the financial plan.
The financial professional can pull up an account and show highlights of the quarter, but any funds taken out to purchase an annuity product during that time will be missing from the picture.
(Image: LIMRA) 
Michael Kazanjian is the chief marketing officer of 
