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Low interest rates and regulatory uncertainty continued to squeeze U.S. annuity issuers in the first quarter, according to the Insured Retirement Institute.

Revenue from annuity sales fell to $49 billion in the first quarter, down 18% from the total for the first quarter of 2016, IRI reported today.

(Related: Annuity Players Continue to Fight Low Rates)

IRI, a Washington-based group for insurers and other players in the insurance-based retirement products market, broke the results down by product category:

  • Fixed annuities (including indexed annuities): Sales fell 14%, to $26 billion.

  • Indexed annuities: Sales fell 10.5%, to $14 billion.

  • Variable annuities: Sales fell 10.4%, to $23 billion.

Variable annuity net assets reached $1.9 trillion on March 31. That was up 3.5% from the total recorded a year earlier.

IRI gets its variable annuity market data from Morningstar Inc. and its fixed annuity market data from Beacon Research.

Another organization, Wink, reported in May that it believes fixed annuity sales might have fallen as much as 15% in the first quarter, with sales of indexed annuities falling 14%.

Although year-over-year annuity sales were down, first-quarter annuity sales revenue was 2.1% higher than the total for the fourth quarter of 2016, according to IRI.

Jeremy Alexander, Beacon chief executive officer, said in a statement that banks and thrifts have been reporting strong sales of fixed annuities.

“There has been a marked shift in sales of fixed annuity products away from independent producers and captive agents, towards the more highly regulated banks and broker dealers,” Alexander said.

Kevin Loffredi, a senior product manager at Morningstar, said Morningstar sees variable products that provide some protection against downside risk doing better than other products.

 — Read Indexed Annuity Sales Fall 14%: Wink on ThinkAdvisor.