There’s a new player in retirement town.
Allianz Life is entering the competitive retirement plan marketplace with a new annuity product. The guaranteed retired income option—Allianz Lifetime Income+ Annuity—will now be available for adoption in employer-sponsored defined contribution plans and is designed as a supplement to Social Security.
According to Allianz’s Matt Gray, head of employer markets, the “timing was right” for the insurance company to enter the defined contribution arena as part of its expansion into new retirement markets.
Leading its defined contribution distribution effort will be newly hired Mike De Feo, who previously held similar roles at VOYA Investment Management and Nuveen Investments. De Feo will be responsible for the distribution strategy, business development and distributor relationships of the company’s defined contribution business.
Gray notes that plan sponsors and plan participants have taken notice of the need to have a guaranteed income option within their plans. Recent research around millennials and annuities, along with the company’s July Quarterly Market Perceptions report, seem to back up this reasoning with the majority of employer-sponsored plan participants interested in annuities as an option as part of their plan. Key findings include:
- 73% of employer-sponsored participants would consider an option that offers guaranteed income for life in their plan if available
- 64% state that market volatility caused by COVID-19 has increased their interest in adding an option that offers guaranteed lifetime income
- 59% would consider adding an annuity to their plan if available
Employees also see an annuity offering as some form of recognition from their employer with 77% saying a lifetime income option offering would demonstrate their employer has a vested interest in their retirement readiness and wellbeing. And 65% say this option would increase their loyalty to their employer.
“Participants face many risks in retirement including: longevity, inflation, market volatility and the need for growth and flexibility to adapt to changing circumstances,” says Gray, and that Allianz feels the annuity can play a key part in their comprehensive financial retirement strategy.
“Having this ongoing source of guaranteed income will help plan participants fund a retirement that could last 20 or 30-years or even longer.”
Lynn Brackpool Giles is a contributing editor to 401(k) Specialist. Giles is a former Managing Director of Communications and Consumer Services for the Financial Planning Association (FPA), where she oversaw all corporate, legislative, and consumer communications. In her current journalistic practice, she is a frequent contributor to numerous financial services industry publications.
