Fixed index annuities continue to be one of the fastest-growing annuity products in the market, rising to record levels in year-over-year sales for the third quarter while also achieving a slight increase in sales over the second quarter according to industry data reported Wednesday.
The third quarter of 2018 saw a record $18 billion in sales for fixed indexed annuities, according to the Insured Retirement Institute. This represents a 2.1% increase versus 2018 second-quarter sales and a 38.7% uptick over 2017 third-quarter sales.
The IRI tally of third-quarter market data for the U.S. annuity industry is based on data reported by Beacon Research and Morningstar, Inc.
However, variable annuity sales were down 4.4% versus the second quarter to $23 billion, while managing to rise 10.1% over the previous year’s third quarter. The IRI attributed the quarter over quarter slump to the lingering effects of the now-vacated Department of Labor’s fiduciary rule last spring.
Variable annuities apparently hit a snag when the DOL fiduciary rule was being implemented, before it got thrown out by the courts, according to IRI spokesman Dan Zielinksi.
There were $14.9 billion in qualified sales in the variable annuity market, down 3.7% from the second quarter, and $8.1 billion in non-qualified sales during the third quarter, a 5.5% drop from second quarter non-qualified sales.