Annuity 2021 Landscape

Due Diligence Works

Off Shoring, Corporate Restructuring, Income, Complexity

Annuity 2021 Landscape

2020 was an amazing year for the annuity landscape. You can take your own definition of what “amazing” means to you. As we look forward to 2021, we see a couple of continuing and new trends:

  • Private equity and offshoring will play an increasing role in annuities, especially fixed annuities
  • As long as the Return of Equity is higher in other parts of the parent company business, individual life and annuities business will continue to be scrutinized and potentially spun out
  • Income will make a comeback. In the current structures and new structures (shared risk with the client), similar to the likes of the movement 20 years ago from defined benefit to defined contribution, the current day 401k
  • The RILA product will start to get over-engineered as carriers try to differentiate. Different from the living benefits arms race last decade, this time risk will be managed, meaning the client will take their share

With these emerging trends and macro forces, navigating and often balancing competing forces is challenging. This, in addition to the hundreds of smaller changes that took place last year and continuing next year, is what makes us excited about this business.

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