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Luma’s New Software Compares Products in Annuity Swaps

Luma Financial Technologies has rolled out new software that helps advisors identify a product best suited to replace a customer’s existing annuity.

The new feature, an addition to its Luma Compare software platform, enables advisors to analyze and contrast features, fees and values of a recommended annuity with the prospective buyer’s active policy. The software can account for current and future market scenarios, as well as the person’s income and death benefits, according to a company news release.

“This new feature furthers Luma’s mission to bring an objectivity and transparency to alternate investment products, including annuity products,” said Luma CEO Tim Bonacci in an interview.

Jay Charles, director of annuity products at Luma, identified as distinguishing capabilities the new offering’s ability to not only compare features of the new and old products, but also outcomes for the client. The tool can contrast, for example, differences in a client’s account value or income payments for each of two products over a given time.

He added that the tool can also be tailored to an advisory firm’s compliance and product suitability requirements.

Luma, a venture of Navian Capital, Bank of America Merrill Lynch and Morgan Stanley, has since 2018 offered distributors a multi-issuer platform for comparing structured products: market-linked investments whose performance or value can be tied to stocks, bonds, commodities and currencies. 

In February of this year, the company introduced Luma Annuities, sales and lifecycle management software that advisors and investment firms can use to transact, configure and manage products including variable, fixed-rate and fixed-indexed annuities. To help bring the new offering to market, the company partnered with Insurance 

In April of this year, Luma also teamed up with Cannex Financial Exchanges to provide data and modeling capabilities for the annuities platform. The companies collaborated to standardize data across annuity products and enable advisors to project how different annuities will perform in different market environments.

Luma’s platform is used by broker-dealers, registered investment advisors and private banks.

The technology firm, founded in 2011 and headquartered in Cincinnati, is one of a growing number of software developers offering tools to help agents and advisors make apples-to- apples comparisons of annuity products.

Early this month, Pacific Life, partnered with Ensight and Insurance Technologies to debut software that can compare the performance of variable annuities from the mutual insurer. In the works is new functionality that will allow for comparisons of fixed-indexed products.

Other tools in the market include Annuities Genius by Agatha Global Tech, Morningstar Annuity Intelligence and FIDx Protection Intelligence.

Bonacci foresees increased adoption of product comparison tools like Luma’s, the rise fueled by the need to better align products with client objectives in a volatile market environment.

“Selecting the appropriate underlyers and product will become even more important than it had been over the previous years, when generally most things went in one direction, which was up,” he said.

See the original article as feature in Life Annuity Specialist, here.