Benefit risk update

Soleares Research, LLC is a market research and consulting firm servicing the annuity and life insurance businesses. We provide, through our website, periodic articles that cover important industry trends; we also offer clients phone or on-site consultations, executive briefings and presentations. We pride ourselves on first-class customer service and responsiveness to our clients. We aim to be an indispensable resource to the marketplace.

List of Articles

Posted By: Steven D. McDonnell Posted On: Jun 05, 2017

Every so often we like to study variable annuity guaranteed living benefit (GLB) account value and risk levels around the industry, as they can impact the health of insurers. This report will be an update to one we published last November, relying on first-quarter data we compiled from company financial reports...

Posted By: Steven D. McDonnell Posted On: Nov 29, 2016

In covering the variable annuity business, oftentimes, due to the amount of product filing activity insurers engage in, our reports almost “write themselves” in that we have much to discuss. During slower periods like these, we tend to comment on broader themes that may be of relevance now, or should be monitored in the future...

Posted By: Steven D. McDonnell Posted On: Jun 03, 2013

It’s been a while since we checked in on variable annuity guaranteed benefit risk levels, and we were reminded of that fact by MetLife’s recent investor day, where the topic was discussed at length. We thought the event provided some good insights, and we’ll share our takeaways, as well as some notes on what has been happening with other companies,

Posted By: Steven D. McDonnell Posted On: Dec 31, 2012

The year 2012 was a time when insurers made reductions to their variable annuity products: these moves included the trimming of guarantees, fee increases, closures of contracts and riders, installation of tighter investment restrictions, cuts to commissions, and even complete departures from the business. Such activity served to depress industry s

Posted By: Steven D. McDonnell Posted On: Aug 20, 2012

At different points in the past we have combed through quarterly financials of stock-traded insurers for data related to variable annuity guarantees, in an effort to gain insight on how such benefits might be impacting insurers. We have just compiled second quarter data and found that, as we expected, for most companies account values fell and net

Posted By: Steven D. McDonnell Posted On: Mar 19, 2012

The way we see it, variable annuity insurers are moving in one of two directions these days: either de-risking, or enhancing their products with an eye toward moving up the market share ranks. What this will mean for total industry deposits over the near term is hard to say...

Posted By: Steven D. McDonnell Posted On: Dec 19, 2011

As we have done in the past, we reserved our last weekly commentary of this year for a reflection on how the variable annuity business performed in 2011. It is our way of getting a narrative started, based on what we know right now…

Posted By: Steven D. McDonnell Posted On: Aug 01, 2011

It probably no longer bears repeating, but an insurer’s variable annuity deposits nowadays are directly connected to the relative strength of its guaranteed benefits. We are in a period where this rule of thumb is very much in evidence, and product changes certain companies have in the works will alter the trajectory of their sales, and influence

Posted By: Steven D. McDonnell Posted On: Aug 16, 2010

In our regular duties we are mostly occupied with following manufacturing trends in the variable annuity business, endeavoring to sort out what is meaningful from what is not. However we also are very interested in the long-term consequences of product decisions insurers make – whether to their sales, profitability, or overall health...

Posted By: Steven D. McDonnell Posted On: Apr 05, 2010

Because of the diminished sales of variable annuities last year, we can’t help but wonder whether the industry can eventually participate more fully in the recovery of the financial markets – or, will it continue to lag? In this report we’ll raise a few questions on the state of the business, and give some thoughts on its prospects for the near te

Posted By: Steven D. McDonnell Posted On: Aug 24, 2009

The recovery in the financial markets that took place in the second quarter not only helped variable annuity sales bounce back for most insurers, another positive development was a reduction in the levels of risk embedded in these companies’ guaranteed benefits, as riders became less “in the money” than before...

Posted By: Steven D. McDonnell Posted On: Jun 29, 2009

Now that the second quarter is wrapping up we figured we’d take a few moments to take quick stock of that period, how the variable annuity industry might have performed. It’s our opinion that when official results from 2Q09 come out they will tell us a lot about the state of the industry and the prospects for leading players over the rest of the y

Posted By: Steven D. McDonnell Posted On: Mar 02, 2009

We have a feeling this spring will be a busy one for the variable annuity business because in addition to submitting annual prospectus updates, most insurers will be looking to adjust their contract and benefit offerings to manage risk, at the same time making sure they aren’t giving any advantages to their competitors...

Posted By: Steven D. McDonnell Posted On: Dec 29, 2008

This is our customary early retrospective of the past year for the variable annuity business, in which we’ll offer a narrative of how things unfolded chronologically in 2008, the market conditions that arose and their corresponding impacts on the competitive landscape. In the process we’ll be commenting on industry data points we have not covered

Posted By: Steven D. McDonnell Posted On: Nov 17, 2008

In the past six years the variable annuity industry has been marked by fierce competition between insurers over who has the richest guaranteed living benefits, a phenomenon that has come to be known as the “arms race.” Recently, however, financial market turbulence has caused a spike in the number of these benefits that are in the money, leaving s

Posted By: Steven D. McDonnell Posted On: Sep 08, 2008

Recently we devoted some more time to sifting through insurers’ financial documents to gather data on variable annuity guaranteed living benefit account values, because we believe the data provide clues as to product priorities around the industry. In this report we have numbers to share with you from seven companies, including a couple we have no

Posted By: Steven D. McDonnell Posted On: Jun 16, 2008

One of our objectives for the upcoming third quarter – traditionally a time each year when variable annuity sales tend to tail off regardless of how the market is doing – will be to pore through more insurers’ filings and financial reports and obtain data related to VA features. Naturally we will share with you whatever new and interesting items t

Posted By: Steven D. McDonnell Posted On: Jun 02, 2008

In the variable annuity business, it’s crucial for leading companies to have new ideas in the pipeline at all times because the living benefits arms wars are still being waged with great intensity. The way we see it, if leading insurers pause from this process, however briefly, they run the risk of losing ground to their competitors, in sales and

Posted By: Steven D. McDonnell Posted On: Mar 24, 2008

A significant number of variable annuity contracts and benefits will be rolling out over the next few months, and as we monitor the goings on, we’ll be watching to see whether new product ideas will cause any major shifts in sales momentum and market share within the industry...

Posted By: Steven D. McDonnell Posted On: Mar 03, 2008

We’re just entering the season where new variable annuity product filings really begin to pick up, and there’s ample evidence that the guaranteed living benefit arms race is still being waged with great gusto. To us, the latest product concepts can sometimes involve rather subtle changes, but in the end they are still mostly about the features bei

Posted By: Steven D. McDonnell Posted On: Dec 17, 2007

Last year at this time we published a commentary with our reflections on how the variable annuity industry performed in 2006, based on what we knew at that point, and made some suggestions as to how the year might conclude. In this report we’re going to start the same exercise for 2007, knowing that we’ll have more to say later, once final results

Posted By: Steven D. McDonnell Posted On: Oct 01, 2007

We’re always on the lookout for real concrete data on variable annuity living benefits and to that end we’ve been combing through insurers’ quarterly financial supplements and statutory statements to extract whatever information is publicly available. In this report we’ll share with you some of the numbers we found and consider the latest directio

Posted By: Steven D. McDonnell Posted On: Aug 13, 2007

This report will wrap up our observations regarding second-quarter variable annuity sales results of major public insurers we normally monitor, and will also include some quick thoughts on new guaranteed living benefits that have been filed lately…