Index annuity sales hit another quarterly record in the 3rd quarter, according to The Advantage Group, a St. Louis, Mo., index annuity tracking service.
Total sales for the quarter came to over $3.3 billion, up 109% from the $1.6 billion reported for index annuity sales in the 3rd quarter of 2001, says Advantage Group owner Jack Marrion in his new Advantage Index Product 3rd Quarter 2002 Sales Report.
Compared to 2nd quarter 2002 sales, the 3rd quarter sales are up 21%, says Marrion.
Over 55% of the 3rd quarter sales came from index annuities that credit bonus interest, the report says. This percentage was up from nearly 44% of index annuity sales that went into bonus products in the 2nd quarter of 2002, and over 40% that went into bonused products in the 1st quarter, according to the report.
Ranked by commissions, the 3rd quarter sales saw 47% of the business going into index annuities that pay agents a street level commission of 11% or more. This is up from 38% of sales that paid street level commissions of 11% or more in the 3rd quarter of 2001, says the report. These figures reflect commissions paid by 28 carriers representing 99% of first quarter sales, Marrion says.
The average commission paid to agents on index annuity sales in the 3rd quarter came to 10.44%, Marrion says. Also, “the average weighted commission paid by carriers ranged from 2.29% to 14.69% of premium.”
Ranked by surrender period, over 70% of 3rd quarter index annuity sales went into products having surrender periods of 10 or more years. By comparison, in the 3rd quarter of 2001, just 60% of index annuity sales went into products with surrender periods of 10 or more years.