Jackson National Life Insurance Co., which is entering the proprietary bank annuity business long after several competitors did, says room remains in the market for a new entrant.

The Lansing, Mich., insurer, which is owned by Britain's Prudential PLC, is in talks with two banks to offer proprietary annuities and is seeking proprietary agreements with other banks as well.

With variable annuities, proprietary agreements let a bank put its own fund portfolios into the product. With fixed annuities, the agreements let a bank participate in managing the assets.

Michael Wells, a longtime Jackson National executive who was promoted to vice chairman last Wednesday, said that proprietary annuities will spur growth for its bank-sold annuities.

In the first quarter the company was 10th in fixed annuity sales through banks, with $194 million, and 17th in variable annuity sales, with $54 million.

Jackson National waited so long to get into the proprietary bank annuity market partly because of its technology, Mr. Wells said. "Six years ago Jackson's then-management decided to outsource all technology. We have a new system in place, and we can compete."

Brad Powell, president of Jackson National's institutional marketing group, said it isn't too late for the insurer to make inroads with proprietary products.

"I think there will certainly be opportunities at banks that already have existing proprietary agreements to launch a second or third proprietary product, much less the many other banks that still don't have one," he said.

In the first quarter American General Corp. was the top seller of fixed annuities through banks, and 60% of its sales were of its proprietary products. "Proprietary funds were huge for them," Mr. Wells said.

Banks that offer proprietary fixed annuities sell 80% more annuities than banks of the same size that do not, according to Kenneth Kehrer Associates statistics.

However, the introduction of a proprietary variable annuity does not increase banks' sales of those products, the Princeton, N.J., firm found.

In the first quarter 33% of all bank variable annuity sales were of products that included proprietary agreements, the company found.

"Fixed product sales go up once a proprietary agreement is in place because platform staff members feel more comfortable selling a product that belongs to them," said Ken Kehrer, president of the consulting firm that bears his name. "Variable annuities are sold more by stockbrokers, and they're less interested in whether bank funds are involved. They're more interested in the inside funds' performance."

Still, Mr. Kehrer agreed with Mr. Wells that insurers need to offer banks proprietary variable annuity agreements. "Banks want them, so Jackson National has to get on board," Mr. Kehrer said.

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