Annuities are now a big business for PE firms
THE UPSHOT FOR ANNUITY OWNERS?
Whether private equity’s foray into the annuity world is a positive development for consumers is not yet known, said Jasmin Sethi, CEO of Sethi Clarity Advisers.
By its nature, private equity lacks transparency, but insurance products are highly regulated, Sethi noted.
Having more transparency in the annuity market would generally benefit customers, as products are currently hard to compare, despite a handful of services designed to help people vet annuities side-by-side, Sethi said.
If private-equity owners guide their companies to slim down product sets, that would be a plus, she noted.
“There are a lot of high-cost products, and there are too many products,” she said. “There could be a reduction, to a better value set.”
“There is room for the market to grow,” and private-equity firms likely see the possibility of annuities increasingly being considered within defined contribution plans, she said.