|[February 27, 2013]
New Market Takes Shape: Deferred Income Annuity Product Helps Redefine Retirement Market as Sales Hit $1 Billion
NEW YORK --(Business Wire)--
New York Life today announced that its new Guaranteed Future Income
Annuity1 (GFIA), a flexible way to generate lifetime income
in the future, exceeded $1 billion in premiums since its July 2011
introduction. In the process, the product led the way in establishing a
new retirement income market for pre-retirees who want to turn their
retirement assets into a lifetime stream of income when they retire.
"Pre-retirees recognize the value that guaranteed income provided to
pension owners in the past and want something like that for themselves.
Our soaring sales illustrate the strong demand for pension-like streams
of income and the enhanced lifestyle they can provide," said Matt Grove,
vice president in charge of the company's annuity products. "On the
whole, it is people in their mid- to late-50s who are responding to our
product because it offers them the 'retirement income trifecta': a
guaranteed, sustainable way to maintain income in retirement;
potentially higher income payments than they could achieve elsewhere;
and reduction of some market risk from their overall portfolio during
the final years of their pre-retirement, when they can't afford to
endure the consequences of a market downturn."
The GFIA allows policyholders to set an income start date in the future,
at which time they will begin receiving guaranteed income payments for
the rest of their lives. Between the initial premium date and the income
start date, they can continue to purchase more future income by making
additional premium payments, and can defer or accelerate their income
start date as their personal needs change.2
The core audience for the GFIA is pre-retirees between the ages of 55
and 65 who plan to retire in five to 10 years. The current payout rate
for a 60 year old male who defers for 10 years is over 10%. For example,
with a $100,000 premium at purchase, a 60 year old male would receive
more than $10,000 a year for the rest of his life starting at age 70.
3 The GFIA is available from New York Life carer agents and
select investment firms nationwide.
"Two years ago, deferred income annuities were a $50 million market.
Today, the market is $1 billion and growing rapidly. We attribute this
growth to the increasing awareness that it is possible to create a more
abundant and sustainable retirement by investing in your future before
you reach retirement age. Our average GFIA customer is 58 years old and
planning ahead by purchasing income that will start at 67. Looking
forward, over 45 million pre-retirees will enter this market during the
next 10 years, so we believe the market has significant growth
potential," added Mr. Grove.
New York Life Insurance Company, a Fortune 100 company founded in
1845, is the largest mutual life insurance company in the United States4
and one of the largest life insurers in the world. New York Life has the
highest possible financial strength ratings currently awarded to any
life insurer from all four of the major credit rating agencies: A.M.
Best (A++), Fitch (AAA), Moody's Investors Service (Aaa), Standard &
Poor's (AA+).5 Headquartered in New York City, New York
Life's family of companies offers life insurance, retirement income,
investments and long-term care insurance. New York Life Investments6
provides institutional asset management and retirement plan services.
Other New York Life affiliates provide an array of securities products
and services, as well as retail mutual funds. Please visit New York
Life's Web site at www.newyorklife.com
for more information.
1 Issued by New York Life Insurance and Annuity Corporation
(NYLIAC) a wholly-owned subsidiary of New York Life. Available in
jurisdictions where approved. Guarantees are subject to contract terms,
exclusions and limitations, and the claims-paying ability of NYLIAC.
This contract has no cash surrender value and no withdrawals are
permitted prior to the income start date. Income payments are guaranteed
at least as long as the annuitant is living provided the annuitant is
alive on the designated income start date. Contracts in which a Life
Only payout option is selected do not provide a death benefit either
prior to or after the designated income start date.
2 The ability to move the income start date is not available
for the Life Only option or in CT. The policy owner can accelerate the
start of income payments to any date 13 months after the latest premium
payment or defer income payments up to five additional years from the
original income start date selected. Additional premium payments can be
made up until two years before the income start date.
3 Life Only option, as of February 13, 2013. Annuity payments
consist of both interest and return of premium. Payout rates are subject
to change and may vary depending on premium amount, age, gender, income
option selected and interest rates in effect at policy issue.
4 Based on revenue as reported by "Fortune 500 ranked
within Industries, Insurance: Life, Health (Mutual)," Fortune
magazine, May 21, 2012. See http://www.money.cnn.com/magazines/fortune/fortune500/2012/faq/
5 Source (News - Alert): Third Party Ratings Reports as of 2/1/13.
6 New York Life Investments is a service mark used by New
York Life Investment Management Holdings LLC and its subsidiary, New
York Life Investment Management LLC.
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