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U.S. Pension Risk Transfer Sales Slow: Survey

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Sales of group annuities for the U.S. pension risk transfer market may be cooling.

Insurers completed $5.8 billion in pension risk transfer transactions during second quarter, down from $8.2 billion in the second quarter of 2018, according to a new batch of group annuity issuer survey data from the LIMRA Secure Retirement Institute.

(Related: Pension Risk Transfer Volume Continues to Head Toward Sky)

Seventeen insurers participated in the latest group annuity issuer survey.

Employers can use group annuities to transfer pension risk in two ways. They can transfer full responsibility through pension buy-out transactions. They can also use group annuities to manage pension obligations they keep, through pension buy-in arrangements.

Single-premium pension buy-out sales fell to $4.7 billion in the second quarter, down from $6 billion in the year-earlier quarter.

Single-premium buy-in sales increased to $880 million, up from a negligible amount in the year-earlier quarter.

Pension risk transfer sales were strong in the first quarter. Although sales volume was down in the second quarter, volume was up for the first half. Pension risk transfer group annuity sales increased to $11 billion for the first six months of the year, up 7% from the total for the comparable period in 2018, according to the issuer survey data.


A group annuity sales data table is available here.

— Read Investors Helping Life Insurers Shift to Pension Transfer Market: Analyston ThinkAdvisor.

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