Taking a ‘Startup’ Job at a Legacy Insurer

Ben Thomason has worked at startups in the retirement space, including iJoin and Vestwell. But he says that his recent move to join Allianz Life, an insurance firm with over 100 years of history, is aligned with that startup mentality due to the space he’ll be working in—retirement income in defined contribution plans.

“If you ask people here, we think of ourselves as a startup in a well-resourced organization,” Thomason says. “It has that feel to it, and I’m very comfortable in that space.”

Allianz hired Thomason this month to lead its DC distribution team for its guaranteed income offerings. He replaces Michal De Feo in the role, who has left the firm.

Thomason says working in the nascent market for in-plan annuity options is similar to working in the target date fund space when those solutions were first coming to market. In that moment, the retirement industry was looking for a solution to the “inadequacy” of qualified default investment alternatives as people were being defaulted into money market or stable value funds without other options, Thomason says.

Today, he says, the industry is searching for an answer to Peak 65, when more retirees than ever are looking to manage decumulation.

“These are well-educated, thoughtful people who just don’t have the tools to build retirement strategies as decumulation vehicles,” he says. “We are working on a way for people to have a comfortable and less anxiety-ridden retirement.”

Allianz entered the market for in-plan annuities in 2022 with its Allianz Lifetime Income+ Annuity for 401(k) plans. In 2023, SS&C Technologies Holdings Inc. added the offering to its DC retirement income platform along with other insurance providers to meet what it called the growing demand.

Thomason will bring to the role experience in startup ventures in the retirement space. He most recently led sales at iJoin, a financial planning, managed account and analytics provider launched in 2017. Before that, he was at Vestwell Holdings, a digital 401(k) provider started in 2016 that has made waves in the retirement space largely focused on the new and small plan space.

Thomason had first started working with Allianz back at Vestwell and then at iJoin, which makes the insurer’s in-plan annuity available to its network of recordkeepers. Thomason says Matt Gray, head of employer markets at Allianz, and he had an “intellectual interest” in the retirement income conundrum that led to regular communication, discussions and eventually his interest in joining Gray’s team.

“He is an actuary by training, and we had a lot of conversations about retirement income as a concept,” Thomason says.

Allianz is competing in what has quickly become a crowded space in recent years. Insurers are partnering with asset managers and recordkeepers to get pension-like annuity options in plans, with options ranging from participants choosing from a menu of annuities to TDFs that will automatically default participants into an annuity when they are closer to retirement. In the meantime, both retail annuity sales and annuity use for pension risk transfers have been skyrocketing in part due to higher interest rates.

Thomason feels confident the demand is there for his new employer’s offerings as the industry grows more comfortable with annuities as a solution to the retirement income puzzle.

“We’re seeing interest from both parties,” he says. “There are the ERISA advisers who very often plan sponsors rely on … and the plan sponsors who are looking for solutions that will benefit their participants.”

Still, he sees the venture still very much “in the early innings” and says it will take time for the in-plan options to make their way into what Thomason calls the “grand mosaic” of the DC marketplace.

“There are plan sponsors, advisers, asset managers, managed account providers, recordkeepers, and all the technology that sits between the recordkeepers,” he says. “They all kind of need to work together in concert.”

Although it’s a complex picture, the network’s interest in this area has shown Thomason early promising signs of his new job.

“Part of the reason I came over here is shown by the number of inquiries from friends in the adviser community, in the asset manager community, in the technology community,” he says. “We’re getting to a place where we need ironclad solutions, which will take awareness and education at each part of the mosaic.”