We would love to hear from you. Click on the ‘Contact Us’ link to the right and choose your favorite way to reach-out!

wscdsdc

media/speaking contact

Jamie Johnson

business contact

Victoria Peterson

Contact Us

855.ask.wink

Close [x]
pattern

Industry News

Categories

  • Industry Articles (21,155)
  • Industry Conferences (2)
  • Industry Job Openings (35)
  • Moore on the Market (414)
  • Negative Media (144)
  • Positive Media (73)
  • Sheryl's Articles (800)
  • Wink's Articles (353)
  • Wink's Inside Story (274)
  • Wink's Press Releases (123)
  • Blog Archives

  • March 2024
  • February 2024
  • January 2024
  • December 2023
  • November 2023
  • October 2023
  • September 2023
  • August 2023
  • July 2023
  • June 2023
  • May 2023
  • April 2023
  • March 2023
  • February 2023
  • January 2023
  • December 2022
  • November 2022
  • October 2022
  • September 2022
  • August 2022
  • July 2022
  • June 2022
  • May 2022
  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021
  • October 2021
  • September 2021
  • August 2021
  • July 2021
  • June 2021
  • May 2021
  • April 2021
  • March 2021
  • February 2021
  • January 2021
  • December 2020
  • November 2020
  • October 2020
  • September 2020
  • August 2020
  • July 2020
  • June 2020
  • May 2020
  • April 2020
  • March 2020
  • February 2020
  • January 2020
  • December 2019
  • November 2019
  • October 2019
  • September 2019
  • August 2019
  • July 2019
  • June 2019
  • May 2019
  • April 2019
  • March 2019
  • February 2019
  • January 2019
  • December 2018
  • November 2018
  • October 2018
  • September 2018
  • August 2018
  • July 2018
  • June 2018
  • May 2018
  • April 2018
  • March 2018
  • February 2018
  • January 2018
  • December 2017
  • November 2017
  • October 2017
  • September 2017
  • August 2017
  • July 2017
  • June 2017
  • May 2017
  • April 2017
  • March 2017
  • February 2017
  • January 2017
  • December 2016
  • November 2016
  • October 2016
  • September 2016
  • August 2016
  • July 2016
  • June 2016
  • May 2016
  • April 2016
  • March 2016
  • February 2016
  • January 2016
  • December 2015
  • November 2015
  • October 2015
  • September 2015
  • August 2015
  • July 2015
  • June 2015
  • May 2015
  • April 2015
  • March 2015
  • February 2015
  • January 2015
  • December 2014
  • November 2014
  • October 2014
  • September 2014
  • August 2014
  • July 2014
  • June 2014
  • May 2014
  • April 2014
  • March 2014
  • February 2014
  • January 2014
  • December 2013
  • November 2013
  • October 2013
  • September 2013
  • August 2013
  • July 2013
  • June 2013
  • May 2013
  • April 2013
  • March 2013
  • February 2013
  • January 2013
  • December 2012
  • November 2012
  • October 2012
  • September 2012
  • August 2012
  • July 2012
  • June 2012
  • May 2012
  • April 2012
  • March 2012
  • February 2012
  • January 2012
  • December 2011
  • November 2011
  • October 2011
  • September 2011
  • August 2011
  • July 2011
  • June 2011
  • May 2011
  • April 2011
  • March 2011
  • February 2011
  • January 2011
  • December 2010
  • November 2010
  • October 2010
  • September 2010
  • August 2010
  • July 2010
  • June 2010
  • May 2010
  • April 2010
  • March 2010
  • February 2010
  • January 2010
  • December 2009
  • November 2009
  • October 2009
  • August 2009
  • June 2009
  • May 2009
  • April 2009
  • March 2009
  • November 2008
  • September 2008
  • May 2008
  • February 2008
  • August 2006
  • Words Matter

    April 7, 2014 by Scott Hinds

    Many readers of Annuity Outlook Magazine and attendees at NAFA speaking events are aware that the Association’s mantra is – WORDS MATTER. 2013 was filled with examples of legislation, litigation and regulation where NAFA’s influence over the choice of words and conceptual framing positively impacted the fixed annuity marketplace and our mission to promote the awareness and understanding of our valuable product line. More than ever, the words you choose and what you say to your clients are some of the most critical parts of the prospecting and sales process.

    Choosing the right words to represent annuity concepts and features is vital because individuals place different meanings and expectations on different words. Choosing the right word can mean the difference between a suitable and an unsuitable sale!

    Here are NAFA’s top ten WORDS that MATTER:

    1 Insurance

    Fixed deferred annuities are NOT INVESTMENTS – they are insurance contracts which promise the money will always earn some minimum interest, but may also earn more interest either at a rate set by the insurer (declared rate or book value annuities) or a rate determined by changes in a market index (indexed annuities). Despite the fact that your clients might see any outlay of their income, savings or other assets as investing, it is essential that they understand that they are buying an insurance product FIRST with insured guarantees.

    2 Interest

    Fixed annuities earn interest. They do not earn “returns” or “gains.” Interest is credited to the policy by the insurance company as stipulated in the contract. Fixed annuity interest can be determined in advance and set by the insurance company based on its investment portfolio or, in the case of an indexed annuity, interest is determined using a formula that measures the performance of a market index. Your client is not participating in the gains market index. Both words – participation and gains – leave consumers with the idea that they are investing in the index, and NAFA recommends that annuity professionals NEVER use the words “participation” or “gains.”

    3 No Investment Risk

    Because annuities are insurance products FIRST and their basic guarantee is that their premium and prior interest are protected from negative financial and economic markets, they have NO INVESTMENT RISK. Do not say that the annuity participates in the market upsides with no downside.

    4 Premium

    The money your clients use to purchase their annuity is premium – just like life, home or fire insurance. Do not use “principal.” This is true even in cases of an exchange or surrender. No matter where the money comes from, the money paid into an annuity is called PREMIUM.

    5 Two Types of Annuities

    There are just two types of annuities – fixed and variable. NAFA worked hard to persuade others to agree to this basic foundation of our product line when working with industry and regulators on the New NAIC Annuity Buyer’s Guides. We are pleased that the Disclosure Model adopted by the NAIC in August of 2013 clearly demonstrates this foundation, and the NAIC has printed a fixed-only and a variable-only version. The fixed-only guide describes variable annuities in general and all fixed annuities specifically. The variable-only version describes fixed annuities in general and variable annuities specifically. For administrative ease, insurance companies with both product lines may choose a version that combines both specific guides.

    6 Interest Calculation

    Interest-crediting methods vary among fixed annuities, and customers may choose from a variety of declared or set-rate annuities and indexed annuities. Indexed annuities are a choice of fixed annuity that determines interest using a calculation of the performance of a market index. Indexed annuities are NOT a “hybrid” or are “in between” a fixed and a variable.

    7 Certainty

    A fixed annuity will provide your client with the certainty of a fixed interest rate that is determined by the performance of the market index or set and established by the insurance company’s own investment portfolio. Once the interest is credited, it is certain to be added to the annuity’s account value.

    8 Safety

    Fixed annuities provide safety from market volatility and economic crisis because a fixed annuity’s account value will never lose money during tough economic times. In addition, the minimum interest guarantee provides the SAFETY of knowing, at minimum, what interest your annuity will earn regardless whether additional interest is determined by the insurance company or the performance of a market index.

    9 Protection

    The biggest concern these days, as many people are living longer and/or retiring earlier, is outliving retirement savings. Fixed annuities can help provide financial protection against the risk of living too long (longevity risk) and running out of money.

    10 Suitability

    The Gold Standard of Suitability provides one of the strongest consumer protections by requiring that annuity professionals put their clients’ interests first by making suitable recommendations; and insurance companies must have a system to double-check each sale for suitability prior to issuing any annuity policy. Fixed annuities are among the highest-rated financial products in consumer satisfaction, with very low complaint rates. Fixed annuities may not be suitable for every individual or every financial plan, but using the WORDS THAT MATTER will help avoid confusion and promote awareness and understanding of their benefits and possibilities.

    Learn More at www.NAFA .com

    Originally Posted at NAFA Annuity Outlook on March 2014 by Scott Hinds.

    Categories: Industry Articles
    currency