U.S. Individual Annuity Sales Power Higher
Fixed-rate products sold well in the second quarter. Variable-rate products sold even better.
Easing of the COVID-19 pandemic and rising interest rates helped push U.S. individual annuity sales toward the sky in the second quarter.
Sales climbed to $68 billion, up 39% from the total for the second quarter of 2020, according to the Secure Retirement Institute’s latest issuer survey data.
Sales of individual fixed annuities increased 27%, to $35 billion, and sales of individual variable annuities leaped 55%, to $33 billion.
The COVID-19 pandemic, and pandemic-related financial turmoil, chilled annuity sales in the second quarter of 2020. Issuers and financial services professionals have been struggling to get sales back on track ever since.
Sales rose 2% in the fourth quarter of 2020 and 9% in the first quarter of this year.
Here’s how sales of five types of annuities changed between the second quarter of 2020 and the latest quarter:
- Traditional Variable Annuities: $23 billion (up from $17 billion)
- Fixed-Rate Deferred Annuities: $16 billion (up from $13 billion)
- Non-Variable Indexed Annuities: $15 billion (up from $12 billion)
- RILA Contracts: $10 billion (up from $4.5 billion)
- Fixed Immediate: $1.8 billion (up from $1.4 billion)
(Image: Adobe Stock)