IRI RESEARCH: ADOPTION OF DIGITAL FIRST STRATEGIES ARE CRITICAL TO FINANCIAL PROFESSIONALS’ USE OF ANNUITIES

WASHINGTON, D.C. – Recent research by the Insured Retirement Institute (IRI) found that financial professionals who do not currently use annuities are likelier to adopt them if the industry implements digital strategies that make the process of transacting and managing these products more modern.

The latest IRI research brief, “Advancing Digital First for Annuities,” reflects a survey of financial professionals to quantify the likely impact of achieving a full digital experience (i.e., the elimination of paper processing and wet signatures) for financial professionals and consumers considering annuity products. The brief also explores financial professionals’ views about which characteristics of a digital experience would drive them to adopt new processes and embrace annuities more fully.

This research is part of IRI’s unique strategic initiative, Digital First for Annuities, which aims to streamline the annuity transaction process for financial professionals and consumers. “Digital First” refers to a strategic approach where organizations prioritize digital channels and technologies when creating and delivering products, services, and experiences. This approach entails designing and implementing processes, services, and products primarily focused on digital platforms, often before considering non-digital alternatives.

These changes would ensure that the process of buying and managing an annuity becomes standardized across the industry, eliminating confusion and avoidable customer service delays that otherwise deter potential consumers.

The survey found that 90 percent of financial professionals said they would incorporate annuities into their practices more if the annuity sales process included e-Signature and e-Delivery capabilities for all annuity transactions.

“Paper forms and wet signature requirements are often deeply embedded in processes for annuity transactions,” said Frank O’Connor, Vice President of Research at IRI. “Financial professionals said loudly and clearly that replacing these older processes with digital capabilities is imperative to improve both the speed and accuracy of annuity transactions and to create an experience akin to what advisors and consumers are used to when investing in mutual funds and other financial products.”

Financial professionals also reported in the survey that creating reliable processes through complete and consistent availability of e-Signature and e-Delivery will create best-in-class service, which survey respondents defined as being fast, efficient, and reliable. Making these three qualities hallmarks of the annuity transaction experience would lead to increased use of annuity products and a more positive perception of service and support.

Only about one in four financial professionals use e-Signature, e-Application, and e-Delivery for all their annuity transactions. At the same time, 74 percent say they have access to all three capabilities. The implication is that most annuity transactions still involve physical forms and signatures, leading to frustration and confusion when different processes are required in different circumstances.

“Achieving digital processing will increase the use of annuities by those financial professionals who incorporate them into their practices today and significant growth in the population of advisors who currently do not utilize annuities, in part due to the onerous processes that are often in place to transact the business,” said Katherine Dease, Chief Technology and Innovation Officer, who oversees IRI’s Digital First for Annuities initiative. “Fast, efficient, and reliable is the demand, and the annuity industry must rise to meet it. IRI’s Digital First for Annuities initiative is laying the foundation for that needed industry transformation.”

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Contact: Dan Zielinski