Market Volatility

Despite a barrage of negative press, it appears that SunAmerica ’s measured approach to the variable annuity business is demonstrating that the successful production of variable annuities is similar to most other lines of insurance . The Hartford ’s recent decision to exit the variable annuity business entirely is attributable in part to their management’s (under significant shareholder pressure) view that the VA business is capital intensive and has relatively unattractive...

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MetLife

SunAmerica

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Short-Term Focus has Adverse Impact on Retirement Income Product Development

Warren Buffett’s most recent shareholder letter focuses on the merits of productive assets such as equities in light of the current low interest rate environment and the potential for future inflation.

Buffett’s view is that although productive assets are variable and volatile, they are more likely to preserve future purchasing power than the fixed or currency-based alternatives.

Buffett’s advice would seem to provide a key...

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Sun Life yet another Casualty of Equity Market Volatility

Canadian insurer Sun Life recently announced that it will exit the variable annuity and individual life insurance markets in the United States. Continued equity market volatility has resulted in a variable annuity business that is plagued with uncertainty and higher costs. Insurers such as Sun Life offer guarantees that are linked to the performance of underlying equity portfolios. These guarantees are a liability for the insurance company , and equity market volatility contributes to the cost...

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