MYGA Frenzy Pushes Annuity Sales Higher in Q1: Wink

Investors’ fears of volatility and the new, higher interest rate environment are continuing to push sales of multi-year guaranteed annuities (MYGAs) higher.

Sales of individual MYGA contracts climbed 173% between the first quarter of 2022 and the latest quarter, to $40 billion, after rising 217% in the previous quarter, according to new issuer survey data from Wink.

The MYGA boom helped produce a 42% overall increase in total sales of the kinds of individual deferred annuities that Wink tracks, in spite of a 22% decrease in sales of variable annuities.

A MYGA contract is an annuity that guarantees payment of a fixed interest rate for a period longer than one year.

What It Means

First-quarter annuity sales figures show that economic turmoil and new benefits obligation accounting rules have not caused a noticeable drop in insurers’ ability to offer your clients annuities with attractive rate guarantees.

Wink

Wink is a Des Moines, Iowa-based firm that has been publishing quarterly annuity sales data since 1997.

The latest report includes data from 104 insurers.

The firm tracks traditional fixed annuities, MYGA contracts and non-variable indexed annuities and classifies them as fixed annuities.

The firm also tracks registered index-linked annuities, or RILAs, and traditional variable annuities, and it classifies those products as variable annuities.

Moore’s View

Sheryl Moore, Wink’s CEO, said non-variable annuities are paying higher rates than bank certificates of deposit can offer.

“As long as CD rates remain so low relative to annuity rates, you can count on indexed and MYGA annuity sales being high,” Moore said.

The Data

Here’s a look at how sales of the annuities Wink tracks changed between the first quarter of 2022 and the latest quarter:

Sheryl Moore (Photo: Wink)