The Tools To Better Manage Disruptions
“RIIA is where you learn about and deal with our industry’s disruptions
before others even know about them.”
Balance
Sheet
Specific
Products
Client
Relationship
Risk
Management
Allocation
Cash Flows
& Life-Cycle
Profile
Retirement
Risk
Profile
The executive knowledge, producer training and consumer research
needed to manage through disruptions in the retirement markets
Comprehensive Data
RIIA Market Insight Program
Advisory Board
Strategic Direction & Guidance, Component Integration, Special Research Projects
Partner Firms – Brightworks Partners, Cannex, Ernst & Young, Gallant Consulting, Healthview Services, Sagence Group
Morningstar
Insured
Income
Portfolio
Strategic
Business
Insights
Healthcare
Profiles
Unmanaged
Income
Portfolio
Investment
Analysis
RMI 360 View of the Market
Financial
Profiles
Spending
Profiles
Equity
Income
Portfolio
Current
Demand
Wealthy
Retired
Affluent
Retired
Mass Market
Retired
Wealthy
Pre-Retired
Affluent
Pre- Retired
Mass Market
Pre- Retired
Wealthy
Builders
Affluent
Builders
Mass Market
Builders
Future
Financials
Future
Demand
Product Sales &
Channels
Distribution
Insurers
Contracts
Depository Trust & Clearing Corporation
(The RIIA Views)
Future
Spending
Future
Healthcare
Profiles
Price
Waterhouse
RIIA Market Insight Program
Featured Partner for Today’s Presentation
DTCC Insurance & Retirement Services
• DTCC, which through its subsidiaries provides
clearing, settlement and information services is:
• Industry owned
• Operates at-cost
• Settles the vast majority of securities transactions in
the US ($1.7 quadrillion in 2011)
• I&RS processed over $156 billion in annuity inflows
and out flows in 2011
• Launched Analytic Reporting for Annuities in June 2011
• Analytic Reporting is an online information solution
aggregating transaction data
Cutting Edge Tracking Of Annuity Flows
Key Metrics
Inflows
Outflows
Net flows
Transactions
Group, Sort, Slice and Calculate Market Share by Combinations of:
Distributors
•
•
Firms
Financial
Professionals
Channel Type
Carriers
•
Firms
Competitor Set
Contract
Entities
Contracts
•
Products
Account Type
Product Type
•
•
•
Owner
Annuitant
Financial
Professionals
Geography
Distribution Channel Classification
RIIA views of DTCC data use the following channel definitions:
Channel
Independent
Wirehouse
Regional
Insurance
Bank
Other
Characteristics
Advisors
Examples
•Comprised of large, & small
broker-dealers
•Independent
Contractors
•LPL
•NFP
•National network
•Self-clearing, NYC-based
•Employees of the B/D
•Merrill Lynch
•Wells Fargo
•Primarily regional
•Some Investment banking
•Employees of the B/D
•CBIZ
•Edward Jones
•Life insurers
•National network
•Career agent
employees & some
contractors
•AXA Network
•Mass Mutual
•Retail banks, thrifts, etc.
•Brokerage services
•Employees & TPMs
•First Tennessee
•HSBC
•Clearing & other platforms
•Fidelity
•Pershing
2011 Annuity Flows by Channel
In 2011, The RIIA Independent channel accounts for almost a third (28%) of the
$90.2 Billion DTCC Annuity inflows
2011 Annuity Inflows ($MM) in RIIA Defined Distribution Channels
In flows
28%
Independent
18%
Wirehouse
24,989
16,224
14%
Regional
8%
Ins
14%
Bank
17%
Others
TOTAL
13,006 7,493
12,968
15,522
90,205
-10,473
-13,485
-66,216
Out
flows
-14,290
-12,805
-11,039
4,123
Net
flows
10,699
3,419
1,967
3,370
2,495
2,037
23,989
43%
21%
15%
45%
19%
13%
27%
Net
flow as
% of In
flow
But the Independent channel accounts for almost half (45%) of the total net
flows in DTCC’s non-captive channel transactions
2011 Annuity Flows by Type & Channel
Looking at major product types, we see the Independent channel doing well in
both Variable and Fixed Annuity product types…
2011 Flows ($MM)
Independent
Inflows
Outflows
All
Netflows
Net % of Inflow
Inflows
Variable Outflows
Products Netflows
Net % of Inflow
Inflows
Fixed Outflows
Products Netflows
Net % of Inflow
24,989
-14,290
10,699
43%
20,326
-10,677
9,649
47%
1,887
-1,548
339
18%
18%
Distributor A: 98%
Wirehs Regional
16,224
-12,805
3,419
21%
10,119
-8,117
2,002
20%
463
-1,942
-1,479
-320%
13,006
-11,039
1,967
15%
10,143
-8,195
1,948
19%
683
-1,602
-919
-135%
Ins
Bank
7,493
-4,123
3,370
45%
5,707
-2,806
2,901
51%
135
-239
-104
-77%
12,968
-10,473
2,495
19%
6,643
-3,825
2,818
42%
5,322
-5,996
-674
-13%
Distributor B: 17%
Others
15,522
-13,485
2,037
13%
10,768
-8,394
2,374
22%
2,795
-3,451
-656
-23%
All
90,205
-66,216
23,989
27%
63,707
-42,014
21,693
34%
11,284
-14,777
-3,493
-31%
Distributor C: -79%
But performance of individual firms within a channel varies greatly
Inflows by Account Type
65%
60%
55%
50%
45%
40%
35%
30%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr
Qualified
Non-qualified
Source: DTCC Analytic Reporting for Annuities
Net flows ($B)
Retention by Account Type (Q1 2012)
5
Retaining assets
4
IRA
3
2
1
Other qualified
0
Losing assets
-1
Non-qualified
-2
0
1
2
3
4
5
6
7
8
9
10
11
Inflows ($B)
Source: DTCC Analytic Reporting for Annuities
Annuity Cash Flows by Geography
Sales territory
Total DTCC processed
zip codes
My inflows ($M)
inflows ($M)
My market share
01222
1.12
5.62
19.93%
02169
0.90
3.20
28.13%
02333
0.79
3.11
25.40%
02026
0.54
1.54
35.06%
02062
0.32
1.42
22.54%
02021
0.26
0.98
26.53%
Total
3.93
15.87
24.76%
My sales territory
Variable annuities
Fixed annuities
Group annuities
Total DTCC processed
My inflows ($M)
inflows ($M)
My market share
2.55
10.32
24.76%
0.98
3.17
30.95%
0.39
2.38
16.51%
Annuity Cash Flows by Geography
• Create custom sales territories
• Benchmark performance in your territories against the
aggregate of transactions processed by DTCC I&RS
• Focus and re-focus sales and marketing activity
• Evaluate the impact of sales and marketing programs
• Determine relative success – did you outperform the
aggregate
Benefits of processing through DTCC I&RS
• Over 124 carriers and 128 distributors, including the
major clearing firms, process annuity and other
insurance transactions through DTCC
• Standards for processing transactions, commissions,
positions and applications
• Efficiencies
• Transactions
• Paying commissions
• Collecting commissions
• Driving additional value by delivering information
services to support members business management
and decision making process
RIIA Market Insight Program Benefits
• RIIA – Join us to direct a program of combined research and
databases designed to present members with a “View Across the
Silos” for the retirement income market
• DTCC - Gain insight that will enable financial services firms to
improve their business and use Analytic Reporting to monitor
results relative to the market and segments of the market
• Sagence - Work with a unique advisory firm specializing in helping
organizations drive their businesses with information and insight
RIIA
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