In the world of finance, where the landscape is ever-shifting, Luanna Teo, Vice President of Brand Development at Knighthead Annuity & Life Assurance Company, offers a compelling perspective on the evolving nature of fixed income investments. Her presentation at the Hubbis Wealth Planning & Structuring Forum - Singapore 2026 is a call to action for financial advisors, urging them to rethink their approach to fixed income and consider the broader needs of their clients. Teo's argument is simple yet profound: clients seeking fixed income are often looking for something more than just a product; they are seeking certainty in an uncertain world.
Teo begins by acknowledging the traditional tools of fixed income, such as bonds, bond funds, ETFs, ladders, and deposits. While these remain useful, she highlights the limitations exposed by recent market conditions. Bond funds, for instance, can be vulnerable to mark-to-market volatility, while bond ladders require scale and ongoing management. Deposits, though comforting, may limit flexibility when used too narrowly. This realization, Teo argues, should prompt advisors to shift their focus from the product label to the client's desired outcome.
The key question, she posits, is not 'What fixed income product should you recommend to your client?' but 'What outcome is my client trying to achieve?' This distinction is crucial because clients may not be seeking bonds per se, but rather dependable income, risk management, capital preservation, or confidence around retirement. Teo emphasizes that annuities, particularly fixed-rate and fixed-index annuities, can provide a complementary tool for clients seeking defined outcomes.
The global demand for annuities is on the rise, with US retail annuity sales reaching USD 461.3 billion last year. Knighthead, Teo reports, has seen significant momentum in international markets, recording USD 2 billion in sales over the past eight months. This growth is linked to demographics, an aging and asset-rich population, and the rising demand for guaranteed lifetime income. Annuities, at their core, are contracts designed to provide guaranteed returns or income streams, and Knighthead's offerings are principal-protected, supporting estate planning through beneficiary nomination.
Teo introduces Knighthead Annuity & Life Assurance Company, established in 2014 in the Cayman Islands. The company serves international clients through fixed annuity products and operates within the broader Knighthead Insurance Group. She emphasizes the platform supporting the products, with client assets held through a segregated master trust structure administered by Ocorian Trust and custodied with Goldman Sachs Bank and J.P. Morgan. Knighthead's audited financial statements, AM Best A-minus financial strength rating, KBRA A rating, and conservative investment approach further reinforce its financial strength.
Knighthead offers three main annuity solutions: multi-year guaranteed annuities (MYGAs), fixed-index annuities, and single premium immediate annuities. MYGAs provide a fixed guaranteed rate over a selected term, typically three to 10 years. Fixed-index annuities allow clients to participate in selected equity indices while protecting principal against market downturns. Single premium immediate annuities are designed for retirement income planning, offering guaranteed income payments over a defined period or for life.
Teo uses the Knighthead Safe Harbour product to illustrate how these annuities can work in practice. For cases of USD 250,000 and above, the fixed rates range from 5.35% for three years to 6% for 10 years. Fixed-index annuities offer S&P 500 caps of 10% for a five-year term and 10.25% for a seven-year term. Selected products also include features such as a 50% free withdrawal benefit and a 101% death benefit, available in multiple currencies.
The discussion then turns to policy illustrations. Teo presents two examples: a client investing USD 1 million and withdrawing USD 50,000 annually over 10 years, receiving around USD 1.13 million at the end of the term with an average annualized interest rate of 6.32%. The second illustration involves a USD 1 million Navigator policy, which, while lacking certain features, provides a higher illustrated return.
Teo emphasizes that these figures are guaranteed, not merely indicative, contrasting them with traditional insurance illustrations that may show higher but non-guaranteed projected returns. She also highlights the breakeven profile, noting that selected products can reach breakeven in around 15 months, while some three-year and five-year products can do so in about one year. This practical point underscores the importance of product structure for clients concerned about lock-up, liquidity, and insurance-style breakeven periods.
In conclusion, Teo returns to the client need behind the fixed income conversation. When clients ask for fixed income, they are often seeking certainty, dependable income, and a clearer path to future financial confidence. Knighthead's annuity solutions, she argues, are designed to address these outcomes through principal protection, guaranteed returns or income streams, asset-liability matching, and a structure supported by segregated custody and financial strength. For advisors, this implies assessing annuities as part of a wider income and capital preservation toolkit, recognizing their relevance where the client's priority is a defined outcome rather than market exposure alone.
