MetLife posts $1.4 bn net loss Jul 31, 2009
Variable annuities are much like mutual fund investments, except they include features such as a guaranteed stream of retirement income. But MetLife's strong balance sheet is helping it stand out against rivals. (India Times)
MetLife Reports Second Straight Quarterly Loss on Investment Writedowns Jul 31, 2009
The company is expanding in variable annuities, the equity-linked retirement accounts that produced losses and drained capital across the industry ... The two firms, whose results have been hurt by variable annuities and fixed-income writedowns, accepted U.S. bailout funds this year as the government expanded its Troubled Asset Relief Program. (Bloomberg -- US)
Bank of America plans to pare back branches nationwide Jul 29, 2009
"Todays actions underscore the need for firms operating bank branches to have effective systems and procedures in place to monitor sales of variable annuities, mutual funds, and UITs, said Susan Merrill, FINRA Executive Vice President and Chief of Enforcement. Bank broker-dealers have access to a broad customer base through their retail bank branches. Proper care must be taken to appropriately supervise sales to those customers CHARLOTTE, N.C. -- Bank of America Corp. said Tuesday it... (Fresno Bee -- Lifestyle)
The Securities Law Firm of Klayman & Toskes Announces That FINRA Has Fined NEXT Financial $1 Million for Supervisory Failures in Connection With Churning of Customer Accounts Jul 25, 2009
In addition to finding violations relating to NEXT Financial's supervision of churning in customer accounts, FINRA determined that "the firm's systems and procedures governing variable annuity exchanges were not reasonable." At NEXT Financial, sales of variable annuities made up about 33% of the brokerage firm's revenue during the relevant time frame. FINRA found that NEXT Financial's "written supervisory procedures...failed to provide adequate guidance concerning the criteria that should be... (Primezone Releases)
Desperate investors are locking in annuities at low rates Jul 20, 2009
Sales of variable annuities, which allow policyholders to move money around in investments similar to mutual funds, have fallen below fixed annuities for the first time since 1995, says Dan Beatrice, senior analyst at Limra's Retirement Research Center. "Clients got nervous and wanted to be in safer investments," says Elizabeth Forget, senior vice president of marketing for. (USA Today -- Money)
Fraud case latest in a string of SEC investigations Jul 15, 2009
s case against Sean Nathan Healy of Weston is just the latest in a string of South Florida related enforcement actions announced by the SEC. , the SEC said it was going after a Poughkeepsie, N.Y.-based firm for luring unsuspecting senior citizens in South Florida into buying highly unsuitable variable annuities. And the SEC filed a lawsuit alleging securities fraud by (now known as ) and three of its former officers for defrauding shareholders. (South Florida Business Journal, FL)
Is it time to take the money out from under the mattress? Jul 11, 2009
Interestingly, while not as conservative an option as fixed annuities, some companies are starting to note a renewed consumer interest in variable annuities. Variable annuities values can fluctuate over time, according to the performance of the underlying investment options and fixed accounts selected ... "A renewed focus on variable annuities could be a sign that consumer confidence in the market is starting to bounce back," Thomsen says. (Ontario Argus Observer, OR)
SEC: N.Y. investment firm misled S. Fla. seniors Jul 1, 2009
The SEC has filed an enforcement action that alleges a Poughkeepsie, N.Y.-based firm lured unsuspecting senior citizens in South Florida into buying highly unsuitable variable annuities ... The SEC alleges elderly and retired investors were lured into purchasing highly unsuitable variable annuities with lucrative sales commissions while ignoring the financial goals of victims. (South Florida Business Journal, FL)
Standard & Poor's to Ring The NASDAQ Stock Market Closing Bell Jun 27, 2009
Standard & Poor's will provide expanded coverage across the entire wealth management spectrum of products and asset classes including stocks, ETFs, mutual funds, variable annuities, and fixed income. In addition to expanded asset class coverage, MarketScope Advisor will provide interactive tools such as alerts, watchlists and hypothetical and model portfolios that enable advisors to stay connected to the market and their investments. (Primezone Releases)
Obama's Financial Watchdog Is Toothless Proposal: John F. Wasik Jun 24, 2009
Federal and state regulators have been inadequately supervising the aggressive marketing of variable annuities for years. Several times a year I get a call or see a story about some 80-year-old who had been sold these high-commission products. (Bloomberg -- Columnists)
ING Groep Will Ask 250 Employees to Leave Japanese Life Insurance Unit Jun 18, 2009
It sells variable annuities and other products through more than 40 Japanese financial firms, including Mitsubishi UFJ Financial Group Inc., the nations biggest bank. To contact the reporters on this story: in Tokyo at. (Bloomberg -- Japan)
The Hartford's CEO To Retire By End Of The Year Jun 5, 2009
The 199-year-old company has been wracked by massive investment losses and costs related to guarantees on variable annuities. The problems drove net losses of $1. (FOX61, CT)
Be careful not to overreact to weakness in insurance industry Jun 5, 2009
Among the troubling commitments: guaranteed payments on variable annuities. Despite the weakness, Janken and other financial advisers are cautioning people about dumping a policy and adding another without careful consideration. (FOX61, CT)
MetLife May Expand in Japan, Vows to Not `Waste a Crisis' as Rivals Falter May 30, 2009
MetLife May Expand in Japan, Wont Waste a Crisis (Update2) - Bloomberg. Updated: New York, May 30 03:42 London, May 30 08:42 Tokyo, May 30 16:42. (Bloomberg -- Japan)
UBS to pay investors, Missouri $169,000 May 22, 2009
From 2002 to 2005, UBS broker Robert Anderson misrepresented the net worth and annual income of senior investors to place them in variable annuities and mutual funds that generated commissions and sales credits for him but these investments were not appropriate for the customers financial situations, according to officials in the Securities Division of Secretary of State Robin Carnahan s Office. Anderson also wrongly completed account forms to show that a mentally disabled adult was a homemaker... (St. Louis Business Journal, MO)
Insurers OK'd for federal asset-relief funds May 16, 2009
Life insurers also requested government aid, worried that their balance sheets had become burdened by illiquid assets and escalating liabilities to policy holders who bought into this decade's explosion in the variable annuities market. lect> Add your comment (max {maxchars} characters) You must be logged in to leave a comment. (Courier-Journal -- Business)
Insurers get preliminary OK for Treasury funds May 16, 2009
Life insurers also requested government aid, worried that their balance sheets had became clogged by illiquid assets and escalating liabilities to policy holders who bought in to this decade's explosion in the variable annuities market. Life insurers own 18 percent of all corporate bonds, so aiding them is consistent with the bailout program's goal of unclogging credit markets. (MSNBC -- Business)
Allstate, other insurers eligible for TARP funds May 16, 2009
Life insurers also requested government aid, worried that their balance sheets had became clogged by illiquid assets and escalating liabilities to policy holders who bought in to this decade's explosion in the variable annuities market. But a final word from the government was slow in arriving, and the stocks of most public insurance companies plunged in recent months. (Crain's Chicago Business)
Unraveling Your Money Worries May 15, 2009
Ray Martin Answered Viewers' Questions About Foreclosure Properties, Credit and Annuities. NEW YORK, May 15, 2009. (CBS News -- Early Show)
AEGON Significantly Improves Earnings in First Quarter of 2009 May 14, 2009
In Q1 2008 new life sales in the UK included European variable annuities, which are now reported in Other countries. Including the sales of variable annuities in the UK in Q1 2009, the new life sales declined with 6% compared to Q1 2008 ... SALES At constant currency EUR millions Notes Q1 2009 Q1 2008 % % New life sales Life single premiums 2,025 2,757 (27) (16) Life recurring premiums annualized 341 410 (17) (13) Total recurring plus 1/10 single 543 686 (21) (15) New premium production accident... (PR Newswire)
Brokers Could Face Jail Time for Misleading Clients May 12, 2009
According to a court filing from the U.S. Attorney for the Eastern District of Louisiana, McFadden "put himself in the position to sell high-commission variable annuities and mutual funds to clients, made material misrepresentations and omissions related to his qualifications, the diversification of stocks, and the investment returns he would achieve." ... Attorney Fogel said that, despite the ground-breaking prosecution, "More regulation is needed to protect investors," especially in regards to... (SmartMoney)
Manulife Scales Back Annuities, May Expand in Asia, Chief Guleoin Says May 8, 2009
Guloien, who took over the CEO post today from , said the company will focus on banking, insurance and investment advice at the expense of variable annuities ... Sales of segregated funds and variable annuities, contracts that provide guaranteed payments upon retirement, about a quarter of Manulifes premiums and deposits over the past two years. (Bloomberg -- Canada)
Buffett Says Life Insurers Took "Crazy" Bets May 5, 2009
OMAHA, Nebraska (Reuters) - Billionaire Warren Buffett on Sunday criticized some life insurers for taking on "crazy" financial risks by selling variable annuities, or retirement products that promised unrealistic guarantees to buyers ... Of the guaranteed variable annuities, Buffett said: "If you buy a policy, you the policyholder get some of the upside, and they guarantee you always get your premium back." From a company's perspective, "that's poison.". (ABC News -- Wire)
What you don't know can hurt you Apr 28, 2009
To be fair, many of the questions were not easy, dealing as they did with topics like lifecycle funds, variable annuities and tax-deferred accounts. But they are questions that, in Hanley's opinion, anyone with a 401(k) or an IRA-type retirement plan needs to be able to answer. (Albany Times Union)
Bruised D'Alessandro offers olive branch Apr 18, 2009
But it can only happen once the market stops worrying about Manulife's exposure to falling stock prices through variable annuities, a kind of individual pension with guaranteed returns. Mr. D'Alessandro still defends the decision to sell the guarantees, and to not hedge much of the risk, as calculated, not reckless. (Globe and Mail -- Business)
Manulife CEO bows to critics Apr 18, 2009
The insurer was hurt by the massive exposure to stock markets it had built up as a result of its variable annuities business. (). (Globe and Mail)
TARP the Life Insurers? This Is Nuts Apr 17, 2009
A lot of these insurers own variable annuities, which are retirement products that guarantee minimum returns no matter what happens to the stock market. Most of these products won't come due for 10 years or more. (Human Events Online)
Fifth Third Securities fined by FINRA Apr 16, 2009
8 million, saying its brokers engaged in a series of what it termed "unsuitable transactions involving variable annuities. The agency said it is continuing to investigate Fifth Third Securities employees involved in the sale, approval and supervision of the transactions. It added that the firm violated rules by allowing improperly registered representatives to buy and sell equities and bonds and did not keep accurate records on its variable annuities business. FINRA also ordered the company to... (Cincinnati Business Courier, OH)
FINRA fines Fifth Third unit $1.75M Apr 16, 2009
75 million, saying its brokers engaged in a series of what it termed unsuitable transactions involving variable annuities ... It contends the firm violated rules by allowing improperly registered representatives to buy and sell equities and bonds and didn t keep accurate records on its variable annuities business ... Those involved variable annuities, complex long-term investments which FINRA charged were being sold to elderly and unsophisticated investors. (Charlotte Business Journal, NC)
Some annuities can offer a safe haven during tough economic times Apr 9, 2009
Variable annuities typically invest in a set of mutual funds the buyer chooses, which means investments are exposed to potential market losses ... Variable annuities also have fees related to the mutual funds they hold. (Boston Globe)
Next bailout: Life insurance gets lifeline from taxpayers Apr 9, 2009
Many life insurers offer consumers variable annuities that pay a guaranteed return, regardless of whether bulls or bears are running the stock market. Although the obligations require payment years off, the financial markets are in such turmoil that life insurers are being forced into protective strategies that make it hard to offset the risks they've assumed. (Yahoo News -- Politics)
Treasury to offer limited aid to insurers Apr 9, 2009
The industrys major financial challenges include balance sheets clogged by illiquid assets and escalating liabilities to policy holders who bought in to this decades explosion in the variable annuities market. Variable annuities pay out according to market performance, but often include guarantees of minimum payouts. (MSNBC -- Business)
Safety sold as part of annuities appeal Apr 7, 2009
Variable annuities typically invest in a set of mutual funds that the buyer chooses, which means the investments are exposed to potential market losses ... Those with variable annuities also must cover the fees related to the mutual funds they hold. (AZCentral -- Business)
Manulife, the millions and moral hazard Mar 28, 2009
It aggressively sold variable annuities and other products that guaranteed returns (and booked earnings from that, which in turn helped the executives meet bonus targets). When the market crashed, the company found itself with a $30-billion paper liability for paying those guarantees to customers. (Globe and Mail -- Business)
Manulife CEO to get $12.5-million in 2009 Mar 27, 2009
The company raised more than $2-billion from common share issues to shore up its capital levels last year after being hurt by its heavy exposure to stock markets as a result of its large variable annuities and segregated funds business. Manulife's executives, including Mr. D'Alessandro, decided to stop hedging the company's exposure to stock markets in 2004. (Globe and Mail)
Can A.I.G. recover from public relations disaster? Mar 24, 2009
He helps clients select variable annuities from a bewildering array of carriers. Related Articles. (International Herald Tribune)
Moodys downgrades Lincoln National Mar 21, 2009
The rating agency added that Lincoln National s investment losses and lower earnings related to the company s significant exposure to the equity markets through its large block of variable annuities with guarantees are expected to result in continued depressed earnings. On a positive note, Moody's pointed out that Lincoln National s regulatory risk-based capital tends to be less sensitive to further declines in the equity markets than are other large variable annuity writers. (Philadelphia Business Journal, PA)
AEGON Maintains Strong Capital Position Despite Fourth Quarter 2008 Loss Mar 12, 2009
Underlying earnings were down mainly due to declining financial markets, resulting in reserve strengthening and accelerated amortization of deferred policy acquisition costs (DPAC) in the variable annuities line of business in the Americas and reduced fees on asset balances in general ... SALES EUR millions Notes Q4 2008 Q4 2007 % At constant currency % New life sales Life single premiums 2,327 3,447 (32) (23) Life recurring premiums annualized 366 456 (20) (16) Total recurring plus 1/10 single... (PR Newswire)
Morningstar, Inc. Announces Organizational and Operating Segment Reporting Changes Feb 20, 2009
The key products and services in this business are Investment Consulting, which focuses on investment monitoring and asset allocation for funds of funds, including mutual funds and variable annuities; and Retirement Advice, including Morningstar Retirement Manager. Peng Chen remains president of Ibbotson Associates. (PR Newswire)
Carnahan fines financial advisers for misleading elderly Feb 19, 2009
Variable annuities are complicated investments that can limit access to your money and often include high fees, Carnahan said in a statement. Two additional orders involve investors from Springfield who were seeking additional income to meet their living expenses. (St. Louis Business Journal, MO)
Sun Life Financial reports fourth quarter and 2008 results Feb 12, 2009
While Sun Life's overall financial returns are very disappointing, reflecting negative equity markets and a stressed credit environment, our balance sheet remains strong and well diversified," said Donald A. Stewart, Chief Executive Officer. "We are well positioned to win customers and pursue opportunities in 2009. " "We remain financially disciplined and focused on performance. (Canada Newswire)
U.S. Life Insurers Dragged Down by Soured Investments Feb 10, 2009
Lincoln National also swung to a quarterly net loss, as costs for variable annuities soared, and returns from investments in hedge funds and private equity evaporated, sending its shares down about 6 percent post-market. The Philadelphia-based company said it expected a life insurance subsidiary to end the year with risk-based capital, a key regulatory metric, of between 380 and 390 percent. (ABC News -- Wire)
DOLLARS AND SENSE: Retirement risk and uncertainty: a fixed strategy Feb 8, 2009
A few months ago I wrote about variable annuities, which many of my clients have been inquiring about. Given the economic climate of today, I wanted to share an alternative to the conditions we have been experiencing. (Bolton Common, MA)
