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February 28, 2024 at 10:44 AM
Executives at U.S annuity issuers and distributors had an unusual experience during their latest round of earnings calls: Wall Street securities analysts were interested in hearing about annuities.
The analysts tell investors what’s hot and what’s not. Insurers and other U.S. companies that sell stock to the public usually hold public conference calls with the analysts every three months to talk about their performance. The companies stream the calls live on the web and post recordings on their websites.
For decades, investor excitement has usually involved providers of web-based services and sellers of products like cell phones and hot new prescription drugs.
Over the past year, however, some of the hardy analysts who still track the life and annuity sector have noticed that annuity sales are booming, and that the publicly traded issuers tend to pay steady dividends or reward shareholders by buying back shares of their own stock.
Total U.S. sales of individual annuities soared to $115 billion in the fourth quarter of 2023, up 29% from the total recorded in the fourth quarter of 2022, according to LIMRA.
Sales of registered index-linked annuities climbed 29%, to $13 billion, and sales of fixed-rate deferred annuities climbed 52%, to $59 billion.
Executives at companies in the annuity market talked happily about booming sales, and then they got into the details. Here’s a look at seven ideas that came up, drawn from what the executives said on Q4 earnings calls.
Credit: Bloomberg
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