NU Online News Service, April 15, 2005, 2:15 p.m. EDT
Bank sales of equity indexed annuities climbed to $259 million in the fourth quarter of 2004, from $93 million in the fourth quarter of 2003.[@@]
Thanks to increasing EIA demand, EIAs accounted for 3.9% of all bank fixed annuity sales in the fourth quarter, up from 1.2% of bank FA sales in the comparable quarter in 2003, according to Kenneth Kehrer Associates, Princeton, N.J.
The issuer of an EIA offers a minimum rate of return and also gives the purchaser a chance to earn a higher rate of return based on the performance of a stock index, such as the S&P 500. Sellers are billing EIAs as a good option for consumers who are willing to accept some, but not much, investment risk.