NU Online News Service, July 17, 2003, 3:04 p.m. EDT – Bank sales of annuities increased to $4.5 billion in May, up 2.3% from the sales total for May 2002, according to a monthly bank annuity sales survey from Kenneth Kehrer Associates, Princeton, N.J.
The researchers who conducted the survey, which was sponsored by Jackson National Life Insurance Company, Lansing, Mich., say the mix of the annuity products that the banks are selling is starting to shift.
“Unlike last year, VAs have been the key to sales growth,” says Brad Powell, president of Jackson National’s institutional marketing group.
Bank sales of fixed annuities fell to $2.7 billion in May, down from $3.5 billion in May 2002.
Bank sales of variable annuities rose to $1.8 billion, up from $900 million.
Experts say variable annuity sales are improving because some investors are more tolerant of investment risk, nervous investors know they can put money in fixed options within variable annuity contracts, and interest rates on bank certificates of deposit are starting to catch up with fixed annuity crediting rates.