Investors have become more risk averse after getting slammed by the stock market and New York Life Insurance Company is trying to capitalize on this flight to safety.
On Wednesday, the company announced the launch of a print advertising campaign that highlights the financial benefits and long-term guarantees of its whole life insurance product. The first ad appeared in the December issues of Newsweek, Kiplinger’s, BusinessWeek and Forbes and the January issues of National Geographic and Smithsonian. Two additional ads will run in Woman’s Day, Parenting, Southern Living, and U.S. News & World Report as well as other publications in the coming months.
The ads will be in addition to New York Life’s existing national ad campaign. The company reported that it increased its 2009 advertising budget by 24% to reach more Americans.
“I find it interesting that previously the industry's ads were for variable annuities and now all of a sudden the advertising is being aimed at whole life insurance,” said Harold Evensky of Evensky & Katz Wealth Management. “It’s a sign of the times. The bloom is off the market, so insurance companies seem to be going back to their risk management core instead of the get-rich products. For many years the focus was on getting rich rather than keeping what you have so this is probably a healthy change.”
The first ad in the new series shows the cash value of a whole life policy from New York Life by displaying its average annual return next to that of the S&P 500 Index over the past decade, the company explained in a press release.
“Americans don’t want to gamble with their savings,” said Mark Pfaff, executive vice president in charge of U.S. Life and Agency, New York Life. “What we’re seeing is a thirst for guarantees in a world where few exist and we felt it was time to remind consumers that a long-standing product has just the guarantees they seek.”
Slow and steady gains are the name of the game for New York Life, one of the last triple-A, credit-rated life insurance companies left. (Read more at "New York Life: The Slow Road Beats the Competition") According to Kehrer-Limra, a financial services and research company, New York Life is the top seller of fixed annuities in the bank channel year-to-date. “That is one of the advantages of being a 164-year-old mutual fund company,” said Chris Blunt, executive vice president in charge of Retirement Income Security at New York Life, in a phone interview last month. “We don’t have to change. We just do our thing.”