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Indexed annuities set record in 2009; overall annuity sales drop 18%

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Annuity sales statistics from 2009 started rolling in recently from a variety of researchers, with LIMRA reporting that total individual annuity sales declined 11% in 2009 to $234.9 billion.

Windsor, Ct.-based LIMRA also reported that while Variable Annuity (VA) sales fell 18% in 2009 (actually an improvement after being down 26% through the first six months of the year), Fixed Indexed Annuity (FIA) sales actually increased by 9% over 2008, to a record $29.4 billion. Fixed Annuity (FA) sales were down 1% for the year, reaching $107.9 billion.

A study by Beacon Research, Evanston, Ill., and the Insured Retirement Institute, Washington, D.C., released on Feb. 17 found similar figures, reporting that total FA sales fell 1.5%, to $105.1 billion in 2009, compared to 2008. That same study found that total FIA sales reached $30.2 billion in 2009, for a year-to-year increase of $3.5 billion.

Des Moines, Iowa-based AnnuitySpecs reported on Feb. 18 that FIA sales set a record in 2009. “The big story this quarter is that sales of indexed annuities exceeded $30 billion in 2009, setting an all-time record. That blows away our previous 2007 annual sales record by more than 10%,” said Sheryl J. Moore, President and CEO of

According to AnnuitySpecs’ Indexed Sales & Market Report, Allianz maintained its ranking as the No. 1 carrier in the FIA market, followed by Aviva, American Equity, Jackson National and ING in the top five. AnnuitySpecs’ results are still preliminary because one company has not yet reported its earnings.

While FIAs enjoyed a banner year, VA struggles clearly led to the overall annuity industry sales decline. “The last time VA sales were at this level was in 2003, at the end of the last financial crisis,” said Joe Montminy, assistant vice president and research director for LIMRA’s annuity research. “VA sales experienced significant losses from the third quarter of 2008 through first quarter 2009 and while we are seeing VAs slowly recover, the recovery is slower than expected. We attribute this partly to a decline in 1035 exchanges.”

Click here for more from LIMRA’s U.S. Individual Annuities quarterly sales survey.

Click here to view the IRI/Beacon Research fixed annuity data.