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Retirement Planning > Retirement Investing > Annuity Investing

IA Sales Rise 23%

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Indexed annuity sales were about 23% higher in the first quarter of 2009 than they were in the first quarter of 2008, although they were slightly lower than in the previous quarter, according to

First-quarter 2009 sales totaled $7.1 billion, down 2.1% from about $7.3 billion in the fourth quarter of 2008, but up significantly from $5.8 billion in the first quarter of 2008, according to, Pleasant Hill, Iowa.

The Advantage Index Product Sales & Market Report for the first quarter of 2009 covers 53 indexed annuity providers and one registered indexed annuity carrier, with data on 94% of the active indexed annuity companies and 99% of production.

The combined market share for the top 5 sellers was 68.7%. Aviva, Des Moines, Iowa, led with a 34% market share. It was followed by Allianz Life, Golden Valley, Minn.; American Equity, West Des Moines, Iowa; Lincoln National Life, Hartford, and Midland National Life, Des Moines, Iowa.

Lincoln took a “surprisingly aggressive hold,” says Sheryl J. Moore, president and chief executive officer of and its affiliate, Advantage Group Associates Inc.

Moore noted that Lincoln moved up to forth place from its previous position in 10th place.

Jackson National Life moved up 3 slots, to sixth place.

Meanwhile, 13 companies have exited the market since the fourth quarter of 2008, says Moore.

Other highlights from the first quarter:

- The indexed annuity commission received by the agent averaged 7.6% of premium.

- The S&P 500 index currently represents over 50% of indexed annuity sales. “Rainbow” indexes (multiple indexes ranging from 1%-5%) represent 7% of sales, and the Nasdaq-100 index represents nearly 3% of sales.

- Qualified sales represent 45% of total first quarter sales

- Sales of indexed annuities with 10-year surrender charges increased to 59% from 45% in the first quarter of 2008. Those with surrender charges of 6 years and under increased to almost 8% from nearly 7% the year earlier.

- Sales of products having surrender charges greater than 10 years declined from the year earlier as did sales of 2-tier indexed annuities.

- The average indexed annuity issue age was 62 years.

- The average indexed annuity sales premium was $56,113, up by about 4% from the previous quarter. By comparison, the average fixed annuity premium reported was $60,369, an increase of about 3% from previous quarter.


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