Close Close
Sign In
Newsletters
Popular Financial Topics Discover relevant content from across the suite of ALM legal publications From the Industry More content from ThinkAdvisor and select sponsors Investment Advisor Issue Gallery Read digital editions of Investment Advisor Magazine Tax Facts Get clear, current, and reliable answers to pressing tax questions
Luminaries Awards
Podcast Center Video Center Webcasts Resource Center Events
About ThinkAdvisor Contact Us Advertise With Us Asset & Logo Licensing Sitemap Terms of Service Privacy Policy Copyright © 2024 ALM Global, LLC. All Rights Reserved.
ThinkAdvisor

Portfolio > Asset Managers

4Q VA Buyers Still Choosing GLBs: LIMRA

By Staff Writer

X
Your article was successfully shared with the contacts you provided.

In fourth quarter 2009, 84% of variable annuity buyers chose to have guaranteed living benefit features added to their policies, according to a new annuity study.

That election rate is down slightly from the previous 4 quarters, when consumers elected GLBs at a rate of 89% or higher, says the report from LIMRA, Windsor, Conn.

The study reflects results from 26 annuity firms representing 95% of fourth quarter 2009 industry sales in which a GLB was elected, LIMRA says. The study covers 188 VA contracts offering a GLB.

The researchers attribute the dip in the GLB election rate to a decline in election of one type of GLB–the guaranteed living withdrawal rider.

However, they say, GLWB market share still remained high. In fourth quarter GLB elections, nearly 75% of sales premiums went into contracts in which a GLWB rider was elected, they say.

In the quarter, GLBs were elected in contracts representing $18.2 billion of new deferred VA premium, the researchers say.

Turning to year-end results, the researchers found that:

–GLWB asset growth outpaced the other types of living benefits. By year-end 2009, GLWB assets comprised nearly half of all VA assets with a GLB.

–VA assets with GLBs attached increased 41%, from $292 billion at the beginning of 2009 to $411 billion at year-end. Total VA assets increased 21% from $1.15 trillion to $1.39 trillion during the same period.

“Especially in this shaky economy, consumers are choosing security through GLBs,” sums up Dan Beatrice, senior analyst, LIMRA Retirement Research. “Despite companies’ efforts to de-risk benefit riders, lowering their comparative attractiveness, 80% of new VA sales premium during the year went into contracts in which a GLB was elected.”

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.