Close Close
ThinkAdvisor

Life Health > Annuities > Variable Annuities

Jackson Executives Talk About the Annuity Gameboard: Earnings

X
Your article was successfully shared with the contacts you provided.

What You Need to Know

  • Jackson kicked off its first quarter as an independent company with $268 million in net income.
  • Primerica, American Equity and National Western Life also reported solid profits.
  • American Equity said its annuity sales increased 128%.

Jackson Financial is now a separate company from Prudential PLC, and it’s now releasing its own quarterly earnings reports and holding its own quarterly conference calls with securities analysts.

Executives at the Lansing, Michigan-based annuity giant, which is the parent of Jackson National Life Insurance, say it’s using the same strategy many competitors are using: emphasizing the sale of products that hold down the company’s exposure to guarantee risk.

The company described its strategy in a slidedeck that covers results for the third quarter, which ended Sept. 30.

The company’s overall sales of retail variable annuities increased 6% from the total for the third quarter of 2020, to $4.8 billion.

But executives noted that sales figures for some types of products were much different than for others:

  • Sales of investment-only variable annuities increased 71%.
  • Sales of other variable annuities without lifetime benefit guarantees increased 33%.
  • Sales of variable annuities with lifetime guarantees fell 8%.

The company also entered the registered index-linked annuity arena in the third quarter, with the introduction of the Jackson Market Link Pro and Jackson Market Link Pro Advisory RILA contracts.

Jackson’s Earnings

Jackson is reporting $268 million in net income for the third quarter on $1.5 billion in revenue, compared with $375 million in net income on $111 million in revenue for the third quarter of 2020.

The company’s latest results reflect the effects of changes in the value of reserves and derivatives.

Operating income, which excludes the effects of those items and some other items, fell to $487 million, from $547 million.

Other life and annuity issuers also reported earnings this week …

Primerica

The Duluth, Georgia-based life and annuity issuer is reporting $111 million in net income for the third quarter on $693 million in revenue, compared with $112 million in net income on $568 million in revenue for the year-earlier quarter.

More on this topic

The company’s own revenue from commissions and fees for its efforts to distribute other organizations’ products increased to $270 million, from $185 million.

The amount of sales commissions the company paid to its own producers increased to $129 million, from $92 million.

The company found that recruits’ COVID-19 pandemic-related preference for remote learning may have reduced its ability to help prospective agents get licensed: The number of recruits fell just 10%, to 91,884, but the number who got their life agent licenses fell 29%, to 9,381.

The size of the life-licensed sales force dropped 5%, to 130,023.

Investment and savings product sales increased 52%, to $2.8 billion.

American Equity Investment Life Holding

The West Des Moines, Iowa-based annuity issuer is reporting $142 million in net income for the third quarter on $543 million in revenue, compared with $661 million in net income on $799 million in revenue for the year-earlier quarter.

The companies’ net results are affected by changes in the fair value of embedded derivatives. Operating income, which excludes that item and some other items, increased to $136 million, from $91 million.

Annuity sales increased 128% from the total for the third quarter of 2020, to $1.3 billion.

National Western Life Group

The Austin, Texas-based life and annuity issuer is reporting $40 million in net income for the third quarter on $155 million in revenue, compared with $11 million in net income on $203 million in revenue for the year-earlier quarter.

Sales of nonvariable indexed annuities increased to $102 million in the latest quarter, from $76 million in the year-earlier quarter.