81% of Annuity Consumers Want Living Benefit Guarantees, IRI Report Shows

Consumer preference for lifetime guarantee of income reflects annuities' growing popularity

More than 81% of U.S. consumers in the variable annuity market wanted a lifetime guarantee of income, the Insured Retirement Institute (IRI) reported in a study released Thursday, June 3.

The report on sales flow data within the U.S. variable annuity market for the first quarter, compiled by Advanced Sales & Marketing Corp., found that consumers who buy annuities overwhelmingly show interest in living benefit guarantees.

"Compared to just one year ago, variable annuity sales are on the rise," said IRI President and CEO Cathy Weatherford in a statement. "And as the popularity of living benefit guarantees grows, we will likely continue to see consumers turning back to the only investment vehicle available that offers a protected income stream for life."

The report also found that the most popular lifetime guarantee consumers chose was a lifetime withdrawal benefit, which provides a protected stream of income for life. Of the companies reporting, about 70% of variable annuity sales flowed into products that offered a set percentage withdrawal from the account for life. This was down slightly from 78% in the fourth quarter of 2009.

Read a story about annuity sales increases from April in the archives of InvestmentAdvisor.com.

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