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Yes, Fee-Based Annuities ExistYes, Fee-Based Annuities Exist

Advocates are working to make fee-based annuities more than just a passing phase.

Samuel Steinberger, Senior Technology Editor

August 30, 2019

Annuity sales is still largely a commissions-based world, but that hasn’t stopped startups and innovators from building—and advocating for—new products that remodel the commission structure. According to a 2018 study, many advisors are frustrated by the “one-size-fits-all” approach that annuity providers are perceived to take.

But instead of bemoaning the form and payment structure of annuities, some firms are getting creative. Digital retirement-focused startup Kindur only offered an annuity on its platform after its founder met with 40 insurance companies to find one that would build the no-commission product the firm needed. DPL Financial Partners' mission to bring more RIA-friendly annuities to advisors means the firm intermediates between advisors and insurance providers to communicate the needs of advisors to product developers. Even Microsoft and BlackRock are working together to devise a new annuity for retirement savers, a reveal made this summer at the InVest conference in July.

With the start of Life Insurance Awareness Month, annuities will be getting more attention. Advisors who have previously written off those products, however, should take another look at them, said David Lau, founder and CEO of DPL. Research points to the usefulness of some types of annuities and openness by insurance companies to remodel their form has made them a tool that advisors should consider when working with clients, he said.

About the Author

Samuel Steinberger

Samuel Steinberger

Senior Technology Editor, WealthManagement.com

Samuel Steinberger is Senior Technology Editor for Informa Connect’s WealthManagement.com. In his role, Mr. Steinberger provides the publication’s wealth and financial technology coverage.

Mr. Steinberger’s editorial insight and familiarity with technology accelerates Informa’s growth within the financial advisor and wealth management communities, providing in-depth news for advisors and financial professionals.

Before joining Informa Connect, Mr. Steinberger produced documentaries with former CNN anchor Soledad O’Brien at Soledad O’Brien Productions (formerly Starfish Media Group). He specialized in research, shooting and editing, as well as finding distinct voices to explain topics like mental health, poverty and racial divide.

Prior to joining Soledad O’Brien Productions, Mr. Steinberger managed multi-departmental technology projects for global legal technology leader Transperfect Legal Solutions. After obtaining his graduate degree in journalism from Columbia University, he completed his transition from technology management to media.

Mr. Steinberger is an award-winning journalist, author and researcher who has written, edited and reported for a number of publications, including The New York Times, Financial Planning, American Banker and PBS. He is founder of beverages publication Give Me Weird Drinks.

Mr. Steinberger’s technology analysis and insight has been featured in several books on virtual and augmented reality. Mr. Steinberger has received awards and recognition for his reporting and research, including the American Business Media's prestigious Jesse H. Neal Award for editorial excellence.

Follow on Twitter: @slsteinberger

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