Provider Overview: MetLife Annuities

MetLife was founded in 1868, but the origins of the company actually go back five years earlier to 1863. It was then that a group of New York businessmen founded the National Union Life and Limb Insurance Company. This company insured Civil War veterans against disabilities due to wartime incidents. After several reorganizations, the company's leaders decided to focus on life insurance to be sold to the middle class.

MetLife, or under its full name Metropolitan Life, was born. The name Metropolitan was used in the new title because the former business had been the most successful in New York City, the "metropolitan" area.

By 1909, MetLife became the insurance company with the largest number of life insurance agents in the United States. The company still holds this position in North America.

Today, MetLife offers a variety of financial and insurance products. In addition to annuities, the company provides mutual funds, estate planning, education planning, and portfolio management to its customers. The company has over $3 trillion in assets under its management. It provides financial services to millions of individual and institutional customers in the United States. Outside of the United States, MetLife has subsidiaries in Asia Pacific, Latin America, and Europe.

Most people would associate MetLife's advertising with Snoopy and the Peanuts characters. MetLife has an agreement to continue using the characters through 2012. The company believes that they help illustrate the corporate vision "to build financial freedom for everyone."

In terms of annuities, MetLife offers three fixed annuity and eight variable annuity products. The individual annuities are listed below:

Fixed Annuities:
• Preference Guaranteed Select Deferred Fixed Annuity
• Preference Flex Select Deferred Fixed Annuity
• Max Income Immediate Fixed Annuity

Variable Annuities:
• Preference Plus Select Deferred Variable Annuity
• Preference Plus Income Advantage Immediate Variable Annuity
• Enhanced Preference Plus
• Financial Freedom Account
• MetLife Financial Freedom Select
• Preference Plus Account
• Preference Premier
• VestMet

The MAX Income and Preference Plus Income Advantage are immediate annuities, while the other products are deferred. An immediate annuity has a payout structure where income payments start no later than one year after the premium is paid. In addition, the premium payment is usually in one installment. However, with deferred annuities, income payments often start many years after the premiums are made.

MetLife's annuities are available with optional living benefit riders for an additional fee. The living benefits that are available are income and withdrawal benefits. Income benefits mean that the annuitant is guaranteed a minimum amount of future fixed lifetime income. They also have the ability to take withdrawals without affecting the future amount. Withdrawal benefits allow the customer to withdraw a portion of their investment each year for a specified period of time.

The financial ratings of an insurance provider are an important indicator of the financial health of the company. MetLife has the following ratings from independent rating agencies, as of July 8, 2009:

• A.M. Best: A+ (2nd highest of 15 categories)
• Standard & Poors: AA- (4th highest of 21 categories)
• Moody's: Aa2 (3rd highest of 21 categories)
• Fitch: AA (3rd highest of 21 categories)