Fixed annuity sales climbed 79% in the fourth quarter to end 2008 at $109.4 billion for the year, overcoming a slump in variable annuity sales and keeping overall annuity sales growth positive, according to LIMRA International.
Meanwhile, life insurance sales ended the year down 7%, reports LIMRA, Windsor, Conn.
VA sales followed the downward trend of the equity market, said Joe Montminy, research director of annuity research for LIMRA, Windsor, Conn. “It’s encouraging that consumers are turning to fixed annuities for their retirement income needs, and as a result, overall individual annuity sales posted a 2% gain, reaching $265 billion in 2008,” Montminy said.
VA sales dropped 30% in the fourth quarter from the same period of 2007. Total 2008 sales of VAs fell by 15% from the year before, to $155.6 billion.
Sales increased for all fixed deferred annuity product types in 2008, lead by a 135% increase in market-value-adjusted products. Sales of book-value products, the largest fixed annuity product type, grew 84%. Indexed annuity sales increased 6%.
Immediate fixed annuity sales, while small in total, increased 23% in 2008, fueled by growing numbers of retirees seeking guaranteed lifetime income, LIMRA said.