What I find the most scary about this aren't so much the simple life annuities...which, like term life insurance, are pretty comperable and due to competative pricing, will provide only a modest commission to the sales rep and only modest profitability to the insurer...what I find alarming are the insurance-based products that are pitched as high guaranteed income-guaranteed principal products, such as equity indexed annuities, principal guaranteed fixed annuities, guaranteed structured layout annuities, and so on. These products are carefully designed to avoid market variability so as to avoid SEC registration and full disclosure rules. I suspect the next 10-15 years will be profitable to many insurers.1. You won't have to wait 10-15 years. The pitch is beginning to made now.2. I do think that there will be easier calculators that will allow "do it yourself" annuity-like projects. Using some of the annuity calculators I've found simple insurance options that pay about $7,000 per year per $100,000 for a 70 year old with no guaranteed payout, inflation increase or spouse guarantee (like I said simple).Right now I can buy treasury STRIPS of denominations that will pay the same $7,000 every year for about 23 years. Add in a little life insurance and you have a very conservative annuity.If you use zero coupon bonds of very good companies (like Coke) you add about 35% more to the time factor. THAT's under a VERY low interest rate environment. I think that there can be calculators that allow very similar products without the intermediary of the insurance company. I plan to do more with this because it also takes care of any problems with a bond ladder.Just speculating.Hockeypop
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