Fidelity VA slow to catch on with fee-based advisers

Fidelity VA slow to catch on with fee-based advisers
Group still 'kicking the tires' on MetLife annuity; offering is popular with firm's reps, however
FEB 17, 2011
The popular variable annuity released by Fidelity Investments with MetLife Inc. appears to have caught on more with Fidelity's representatives than with its fee-based adviser force. Last year's total sales of the MetLife Growth and Guaranteed Income variable annuity added up to more than $1 billion. This simplified VA comes with a built in 4% to 6% guaranteed lifetime withdrawal and offers only one fund, the Fidelity VIP FundsManager 60% portfolio. The MGGI variable annuity is one of two VA options available at Fidelity, which offers the Fidelity Personal Retirement Annuity as well. The FPRA brought in more than $1.5 billion in sales last year. Both products are on the cheap side, and neither pays a commission. The FPRA costs 25 basis points for accounts below $1 million and 10 basis points for accounts over that threshold. Meanwhile, the MetLife annuity has an all-in cost of 1.9% for a single life and 2.05% for joint coverage. Sales of the MetLife product by fee-based advisers didn't account for a substantial portion of sales in 2010, said Jeff Cimini, president of Fidelity Investments Life Insurance Co. “They're still kind of kicking the tires,” Mr. Cimini said of the fee-based advisers. “We have long term hopes that this is something that aligns very well with the fee-based advisers.”

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