What is Carrier (Insurer)?
A carrier (also called an insurer or issuer) is the insurance company that issues and stands behind an annuity contract. The carrier is the entity making the guarantees – the credited rate, surrender values, death benefit, and lifetime income payments. Without the carrier’s promise to pay, the annuity is just a piece of paper.
What Carriers Do
Annuity carriers are licensed life insurance companies regulated by each state where they sell. They collect premiums, invest those premiums in their general account (typically a portfolio of investment-grade bonds), and pay contractual benefits over time. Carriers must maintain reserves required by state law – typically more than enough to pay all current obligations – and submit to annual financial examinations.
How to Evaluate a Carrier
Before buying any annuity, check the carrier on three dimensions:
- Financial strength ratings: Look at AM Best, S&P, Moody’s, and Fitch ratings. Cross-reference with the COMDEX score.
- State guaranty coverage: Confirm the carrier is licensed in your state and that the guaranty association covers you up to your premium amount.
- Track record: How long has the carrier been in business? Have they had stable ratings? Have they ever been placed under regulatory supervision?
Carriers vs Brokers vs Agents
The carrier issues the contract. A broker represents you and shops multiple carriers. An agent typically represents one or more specific carriers. My Annuity Store is an independent broker-style platform – we represent 90+ top annuity companies, not a single insurer, so we can match you to the strongest contract for your situation.
