U.S. insurers reported strong individual fixed and indexed annuity sales in the third quarter as life sales were dropping.
Although deferred individual variable annuity sales fell 18% from the total for the third quarter of 2007, to $38 billion, sales of deferred individual fixed and indexed annuities increased 46%, to about $28 billion, according to researchers at LIMRA International, Windsor, Conn.
The LIMRA researchers, who base their results on a survey of 59 companies, say the flow of cash into deferred individual indexed annuities was 5.2% higher, and the flow of cash into deferred individual fixed annuities was 4.8% higher.
Investment earnings growth amounted to 0.5% of assets for indexed annuities and 1% for fixed annuities.
Investment losses on deferred individual variable annuities amounted to 8.3% of assets, but the flow of cash into VA contracts increased 2.8%.
Meanwhile, over on the life side, overall individual life premiums fell 4%, and the number of policies sold fell 1%, LIMRA researchers estimate.
Premium revenue was flat for term life and up 7% for whole life.
Premium revenue drops for other products ranged from 12% for universal life to 41% for variable life.
In related news, LIMRA researchers say a separate survey of about 700 experienced insurance producers found that about half said they noticed an increase in business and referrals in November.
“Much like what we saw in our recent consumer survey, producers are not seeing their clients abandon the market,” Robert Baranoff, a LIMRA senior vice president, says in a statement about the survey findings. “Producers report that almost 90% of their clients made no changes to their financial portfolios as a result of the financial crisis and 46% of the producers surveyed obtained new referrals during this period.”
About 90% of the producers surveyed in early November told LIMRA they expect their 2009 business will be as good as or better than their 2008 business.
The producers said they want life insurers to be provide more information about how stable life insurers are.