Sales of so-called immediate annuities are climbing as retirees are drawn to lifetime payments guaranteed by U.S. insurance companies.
Immediate annuities pay a periodic fixed amount of money for life in exchange for a lump-sum payment. New York Life Insurance Co., the largest policyholder-owned U.S. life insurer, reported an 80 percent increase in sales of the contracts during the first quarter from a year earlier.
“This is just the tip of the iceberg,” said Chris Blunt, executive vice president of retirement income security at New York Life.
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