Can I Buy Annuities Without Using An Agent?

Question: I am seriously considering adding an annuity to my portfolio, but after a few lackluster meetings with local agents, is there a way for me to purchase annuities direct from the annuity company? I would like to own an annuity, but not use an agent if possible. Dwayne from Richmond, Virginia.

Answer: I am one of those “dreaded” annuity agents, but I fully understand your question and am getting versions of this request on a weekly basis. I think people like you are getting tired of the typical one size fits all high pressure approach that too many annuity agents use. It’s an unfortunate and ongoing problem within the annuity industry because annuities are fantastic transfer of risk strategies when allocated properly within a customized portfolio.

To answer your question about buying annuities direct, the short answer is yes……kind of. Let me explain. Currently, you can purchase no load variable annuities from places like Fidelity and Vanguard and annuity carriers like Jefferson National, Ameritas, and Pacific Life. The best of that bunch, in my opinion, is Jefferson National. As of today, there aren’t any no load fixed indexed annuities, but I see that changing very soon and personally know of a couple of companies working on that type of offering.

Unlike most in the annuity industry, I actually see no load annuities as a healthy direction for this product category. The easy correlations to point out would be what happened when stock transaction costs went from hundreds of dollars to less than $10, and when mutual funds started offering no load versions as well. The same trend will happen with annuities in the near future. Simplicity and transparency will always be demanded by the consumer at the end of the day. Annuities are the next product category to fall in line, and I think all annuity products (load & no load) will improve because of this trend.

As a caveat, Single Premium Immediate Annuities (SPIA’s) and Longevity Annuities (DIA’s) are no load (i.e. no fee), but you also give up liquidity with these types of transfer of risk income solutions…so I’m not sure that you can fully classify them as no load annuities.

Other than the selected variable annuities I listed above, the no load annuity shelf is pretty bare……for now. In the interim, depending on the specific type of annuity that fits your situation the best, you might have to hold your nose and use an agent. Hopefully, you can find someone in your area that has your best interests at the forefront of their recommendations.

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