Magazine article American Banker

Lincoln and Wells Fargo Alliance to Sell a More Flexible Annuity

Magazine article American Banker

Lincoln and Wells Fargo Alliance to Sell a More Flexible Annuity

Article excerpt

Lincoln Financial Group is looking to banks for initial distribution of a variable annuity that gives investors more access to their money, and it has struck a deal with the San Francisco banking company Wells Fargo & Co. to start the process.

The product, called Wells Fargo New Directions, is the first major offering to use Lincoln's new Income4Life program, which differs from other variable annuities in that it gives investors a lump sum of money to draw on in addition to the recurring revenue, said Bill Boscow, chief marketing officer at Lincoln Annuities, a subsidiary of Lincoln Financial.

The goal is to give investors much more access to their money during their retirement in case of a catastrophic event or other need, Mr. Boscow said. Lincoln is also planning to use the Income4Life plan -- which it is trying to patent -- in other banks' or brokers' annuity platforms, he said.

The distribution deal, announced Tuesday, is aimed at helping Wells, and eventually other banking companies, to retain customers' retirement assets, Mr. Boscow said. This is particularly crucial since retirement rollovers are widely seen as one of the industry's fastest-growing areas and one that mutual fund giants like Fidelity Investments are targeting, he said.

Wells Fargo New Directions will be sold through the Wells Fargo Private Client Services group and Lincoln's broker-dealer group, said Lorry Stensrud, CEO of Lincoln Annuities. It is made up of three variable annuities with different payment structures, and it has 40 variable and 10 fixed investment options, including Wells Fargo Funds and American Funds, Mr. Boscow said.

Wells will target its private-client customers who have at least $50,000 to invest, Mr. Stensrud said. Most are likely to be 10 to 15 years from retirement age, he said.

Lincoln supplies other distribution and wholesaling support, as well as the insurance component, Mr. …

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