Close Close
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

Retirement Planning > Retirement Investing > Annuity Investing

Annuity Sales Down in Q1, but VA Assets at All-Time High: IRI

Your article was successfully shared with the contacts you provided.

First-quarter annuity sales fell more than 2.5% to $53.1 billion, the Insured Retirement Institute announced on Thursday. IRI studied data from Morningstar and Beacon Research for its quarterly report.

Variable annuity sales also fell, dropping 2.7% to $36.2 billion. However, IRI found that net assets reached an “all-time high” of $1.61 trillion, up 7.2% from the fourth quarter of 2011. Net sales fell over 34% year over year to $3.8 billion.

“We believe the long-term horizon for the industry looks strong,” Cathy Weatherford, IRI president and CEO, said in a statement. “The markets will always experience its ebbs and flows, but at the same time, we are seeing strength within the fixed annuity market as consumers are turning to income annuities as a source of lifetime income to attain financial security during retirement. The historic level of variable annuity net assets shows that insured retirement strategies are, more and more, becoming the savings vehicle of choice for many consumers.”

Fixed annuity sales fell 2.2% to just under $17 billion and took in $7.3 billion in qualified sales and $9.6 billion in nonqualified sales. Income annuities were especially strong, growing 23% over the first quarter of 2011. Indexed annuity sales, while not as strong as income annuities, also increased over the year-ago period, rising 9%.

“Growing demand for guaranteed retirement income helped push income and indexed annuity sales above year-ago levels,” Jeremy Alexander, president of Beacon Research, noted. “Market value adjustments enabled carriers to credit a higher rate of interest, and that boosted quarter-to-quarter sales of these products.”


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