Voya 2013 Annual Report Download - page 27

The following chart presents the key in-force annuity and mutual fund custodial products within this
segment, along with data on AUM for each product, excluding payout annuities:
($ in billions) AUM
Annuity Product As of December 31, 2013
Fixed Indexed Annuities (FIA) .............. $12.6
Multi-Year Guarantee Annuities (MYGA) &
other Fixed Annuities .................... $ 7.3
Mutual Funds Custodial Products ............ $ 3.4
Markets and Distribution
Our target markets for annuities include individual retirees and pre-retirees seeking to accumulate or receive
distributions of assets for retirement. Annuity products are primarily distributed by independent marketing
organizations, independent broker-dealers, banks, independent insurance agents, pension professionals and
affiliated broker-dealers. The following chart presents our Annuities distribution, by channel.
($ in millions) Sales % of Sales
Channel
Year Ended
December 31, 2013
Year Ended
December 31, 2013
Independent Insurance Agents /
Independent Marketing Organizations .... $740.7 30.2%
Independent Broker-Dealers ............ $801.6 32.7%
Affiliated Broker-Dealers .............. $506.4 20.6%
Banks and Other Financial Institutions .... $405.0 16.5%
Our mutual fund custodial products are distributed nationally, primarily through relationships with
independent brokers, financial planners and agents. New sales are obtained from a “rollover” from an existing
retirement account. The resulting custodial account is established as an IRA to maintain tax-deferred status for
our customer.
On December 9, 2013, we announced a strategic alliance with The Allstate Corporation that will enable
Allstate to offer a full suite of our fixed annuity product offerings to Allstate customers. The fixed annuity
products are issued by ING USA and ILIAC.
Competition
Our Annuities segment faces competition from traditional insurance carriers, as well as banks, mutual fund
companies and other investment managers such as Allianz, Aviva, American Equity, AXA, Lincoln and Great
American. Principal competitive factors for fixed annuities are initial crediting rates, reputation for renewal
crediting action, product features, brand recognition, customer service, cost, distribution capabilities and
financial strength ratings of the provider. Competition may affect, among other matters, both business growth
and the pricing of our products and services.
Mutual fund custodial products compete with brokerage accounts and other financial service and asset
allocation offerings.
Underwriting and Pricing
We generally do not underwrite individual lives in our Annuities segment. Instead, we price our products
based upon our expected investment returns and our expectations for mortality, longevity and persistency for the
group of our contract holders as a whole, taking into account our historical experience. We price annuities by
analyzing longevity and persistency risk, volatility of expected earnings on our AUM and the expected time to
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