As you’re wrapping up your 2010 sales and gearing up for the holidays, most of you are done for the year and already planning your strategy for 2011. A growing number of our readers pin their success on how well they do with their number one product–fixed-index annuities.
Contributing writer David Port has been researching the FIA market and come up with some pretty interesting findings for the coming year. Below, I’ve included highlights from a major piece that will appear next year in Senior Market Advisor.
The sales story: A report from Beacon Research, claims FIAs now represent a record 44 percent share of fixed annuity sales. Third-quarter 2010 indexed annuity sales reached $8.6 billion, their second consecutive quarterly eight-year high. FIA sales were up 17 percent in third quarter 2010, compared to the same period of 2009, while most other annuity products lost ground.
Head-to-head versus variable annuities: While FIAs can’t rival variable annuities in terms of overall market share (despite record FIA sales levels, variable annuities still easily outpaced their indexed counterparts in the third quarter of 2010, $34.9 billion to $8.6 billion), competition between the two product types clearly is escalating. Indeed, the emergence of “better [indexed annuity] products with better consumer value” is making insurers, marketers and advisors alike take notice, says annuity expert Garth Bernard, founder and CEO of the Sharper Financial Group in Boston.