The Insured Retirement Institute reported last week that first quarter annuity sales gained a double-digit increase over sales from the same time period last year.

Industry-wide sales were up 17 percent from $49.7 billion first quarter 2010, reaching $58.1 billion. First-quarter sales also saw quarterly growth, increasing 5 percent over $55.2 billion from the fourth quarter of 2010. Variable annuity assets reached $1.6 billion, the highest level ever recorded by Morningstar.

In response to the findings, IRI President and CEO Cathy Weatherford said, “Recent IRI research shows that 92 percent of boomers who own annuities have a higher confidence in the financial stability of their retirement compared to those who do not. The first quarter data shows that the peace of mind that only annuities can bring to a holistic portfolio is being increasingly recognized by those most in need of guaranteed retirement income – a trend that we expect to continue throughout the year.”

Fixed annuity sales increased 7 percent, reaching $18.9 billion, up from $17.6 billion in the previous quarter. Year-to-year quarterly sales of fixed annuities were up 6 percent, increasing from $17.9 billion in the first quarter of 2010.

Variable annuity sales for the first quarter were $39.2 billion, up 4 percent from $37.6 billion in the previous quarter. Year-to-year quarterly sales of variable annuities were up a considerable 23 percent from first quarter 2010 sales of $31.8 billion. First quarter 2010 net sales were $5.8 billion. There were $26.2 billion in qualified sales and $13 billion in non-qualified in the first quarter.

“The upticks in both sales and net cash flow suggest growing momentum in variable annuity usage as advisors continue to become more educated about the unique benefits of variable annuities and grow increasingly comfortable with them as an important component of a sustainable income producing portfolio,” said Morningstar Director of Insurance Solutions Frank O’Connor.

Source: IRI

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