New sales were up 12.6% over 3Q last year
Variable annuity new sales of $33.5 billion in the third quarter were just a shade above second quarter new sales of $33.3 billion but still quite strong in a quarter that historically has been the weakest of the year.
The $33.5 billion in third quarter new sales represents a 12.6% increase over sales in the same period in 2004 and brings the year-to-date total for new VA sales (excluding internal exchanges) to $98.1 billion. Given this strong third quarter performance, the second quarter estimate for 2005 new sales has been revised from $128.5 billion to $131 billion.
Of the Top 25 companies, the five with the highest sales momentum in 2005, as measured by the ratio of 9/30/05 YTD sales to 2004 full-year sales, are as follows: Ameriprise (IDS Life) with a sales ratio of 109.4% and 4.9% market share; Ohio National Life, 105.5% with .6% market share; Jackson National Life, 95.3% with 3.5% market share; John Hancock Life, 92.0% with 5.6% market share; and Northwestern Mutual, 91.0% with a .6% share of total VA sales.
The five VA contracts showing the most significant growth in sales momentum were the RiverSource Retirement Advisor Advantage Plus VA with a sales ratio of 178.3% and 2.9% market share; the Equitable Accumulator Elite VA, 118.4% with 1.7% market share; the American Skandia Apex II, 118.3% with 1.7% market share; the John Hancock Venture III VA, 106.7% with a 3.3% market share; and finally the Equitable Accumulator 2004 VA with a sales ratio of 100.7% and market share of 1.7%.
Retirement Advisor Advantage Plus offers a purchase payment bonus, guaranteed minimum accumulation benefit, guaranteed minimum income benefit, and maximum anniversary value and earnings enhancement death benefits. The Equitable Accumulator products offer maximum anniversary value, rising floor and earnings enhancement death benefits in addition to GMIB, GMAB and guaranteed minimum withdrawal benefit. Accumulator Elite is an L-share product (four-year surrender charge). American Skandia’s Apex II offers all three death benefit options, and also offers GMIB and GMWB. Finally, John Hancock’s Venture III VA offers maximum anniversary value and earnings enhancement death benefits and a GMWB.
Market share movers included Lincoln National Life, ranked seventh by new sales in 2004, which moved to the No. 5 spot as of 9/30/05 year-to-date. Hartford Life moved from first to third, swapping positions with TIAA-CREF. MetLife maintained its No. 2 ranking (2004 data adjusted to reflect the acquisition of Travelers Life–MetLife actually ranked fourth and Travelers 12th in 2004), while Pacific Life dropped two spots to rank 10th. Jackson National Life continued its growth in market share, moving from 14th in 2004 to 12th as of 9/30/05. MassMutual and Merrill Lynch each dropped two slots, 20th to 22nd and 23rd to 25th, respectively.