Overall U.S. annuity payments may have fallen in 2016, but the numbers looked better in some states than in others.
Analysts at the Center for Insurance Policy and Research, an arm of the National Association of Insurance Commissioners, give a state-by-state annuity market reckoning in their latest insurance industry snapshot report.
(Related: Q4 Annuity Sales Fell 18.4%: IRI)
The NAIC has posted a copy of the insurance industry snapshot here.
The center analysts found, based on life insurer filing data, that, excluding the effects of reinsurance arrangements, total annuity consideration payments fell to $245.7 billion in 2016. That was down 2.9% from the total for 2015.
At the state level, the level of change in annuity consideration payments ranged from a decrease of 29%, in Nevada, to an increase of 14%, in New Hampshire. The median change was a decrease of about 4%.
Individual fixed annuity considerations increased 22%, to $48 billion, as individual variable annuity separate account considerations fell 23.5%, to $69.5 billion.
The term “annuity consideration” refers to the amounts of cash a buyer pays to an insurance company in exchange for an annuity contract. The term includes premiums along with other payments, such as payments of fees, that may not necessarily be classified as premium payments.
For the issuers, the individual annuity business was still a good business to be in: The issuers’ overall operating margin increased to 12.2% in 2016, from 7.9% in 2015. That compares with a net margin of 4.2% for group life, and just 4% for individual life.
Annuity sellers in five states operated in markets with annuity consideration growth of 4% or more.
Here’s a look at the five states with the strongest annuity consideration growth between 2015 and 2016.
1. New Hampshire
2016 Annuity Considerations: $1.99 billion