MetLife Investors Distribution Co., the bank, wire house, and broker-dealer distribution arm of insurance giant MetLife Inc., says it is counting on a new deal with Merrill Lynch & Co. to propel its sales of annuities to more than $3 billion this year.
The company said Monday that it has agreed to distribute its variable annuities through the Merrill Lynch Insurance Group in New York, which offers insurance products to brokerage clients.
MetLife Investors is now one of 13 companies that provide annuities to Merrill Lynch customers, said Chris Grady, first vice president of distribution and business development for Merrill Lynch Insurance Group. He said Merrill's financial advisers are licensed to sell insurance and annuity products and "many of them want a broad product line to supply them." The brokerage constantly reevaluates its annuity providers, dropping some and adding new ones like MetLife Investors, he said.
Greg Brakovich, who is co-chief executive officer of MetLife Investors, along with Jamie Shepherdson, said MetLife Investors began training Merrill Lynch brokers on the products March 4.
Mr. Brakovich said he hopes the brokerage company will become one of his company's top three accounts by yearend.
Mr. Grady said Merrill Lynch sold $3.3 billion of annuities in 2001 and about 90% of the total was in variable products. He said the total was down about 12% from the year before but that sales are up about 40% this year to date.
Last year, MetLife Investors sold $1.5 billion of annuities through such partners as A.G. Edwards & Sons Inc., PNC Financial Services Group Inc., and Dime Bancorp, Mr. Brakovich said. However, he said, the banking companies mainly sell fixed annuities and the Merrill deal is for variable products.
Mr. Brakovich said MetLife Investors hopes that the Merrill arrangement and others it intends to complete within a few months will help its variable annuities business grow. The company introduced its first variable annuities last April.
MetLife Investors hopes to extend the Merrill relationship to other products in the future, Mr. Brakovich said.
This is a good time to push new distribution of variable annuities, he said, despite the pounding these products have taken in the past year, because the market slump has caused a lot of innovation. "You've got so many new features with these new variable annuity products - dollar cost averaging, death-benefit riders. ... I think it's a great way to invest," he said.
MetLife Investors was founded two years ago when its parent combined two units - Cova Financial Services Life Insurance Co. and Security First Life Insurance Co. - into one operation designed to create and sell insurance and annuity products through broker-dealers, wire houses, and banks. The company's parent is one of the largest life and annuity companies in the world, but it primarily sells its products, which are different than those sold by MetLife Investors, through dedicated agents who only sell the products of the insurer.
Merrill Lynch, which is based in New York, has 14,000 financial advisers and $1.5 trillion of client assets.
