When offering clients a guaranteed minimum withdrawal benefit product, independent advisors will now have to cross Sun Life Financial Inc. off their list.
As of May 11, Sun Life will be suspending new sales of its SunWise Essential Series, a segregated fund series with a GMWB benefit, through its third party advisor channels. Clients can still purchase the products through a Sun Life advisor.
The combination of low interest rates and high capital requirements caused to insurer to put an immediate halt on the sales of its segregated funds, which wasn’t ideal but necessary, says Paul Fryer, vice president, individual business management for Sun Life Financial Canada, based in Waterloo, Ont.
“We don’t like to suspend products and we always want to grow product sales through both sales forces — independent and career force, but it was necessary to take action with rising capital requirements.”
The insurer is currently working with Toronto-based CI Financial Corp. to make modifications to SunWise’s existing product line-up, adds Fryer. “We are aiming to have a modified version of the funds available by the end of the year.”
Sun Life is the fourth insurer to suspend its GMWB option this year.