Filed Under:Life Insurance, Life Planning Strategies

Kehrer-LIMRA: Bank Annuity Sales Up 11% Over Year-Ago Period

Photo Credit: jscreationzs
Photo Credit: jscreationzs

Annuity sales through financial institutions increased nearly 11% in the third quarter of 2011 compared to the comparable period one year ago, according to a new report.

Kehrer-LIMRA, a subsidiary of LIMRA Services, Windsor, Conn., published this finding in a summary of results from its monthly bank annuity sales survey. The results are based on a national sample of banks that have a minimum of $4 billion in assets.

The participating institutions account for about one-third of all bank annuity sales.

The survey reports that bank annuity sales increased to $9.2 billion in third quarter from $8.3 billion in the third of 2010, a 10.8% rise.

The third quarter figure is, however, down from the $10.1 billion recorded in the second quarter of 2011.

Variable annuity sales through financial institutions in the third quarter totaled $5.2 billion, up 24% from the $4.2 billion posted in the third quarter of 2010.

Fixed annuity sales through banks topped out at $4.0 billion in the year quarter, a 5% decline from the year-ago period.

The Kehrer-LIMRA report also shows the average effective yield on bank fixed annuities at 1.24% as of September 15, below the average 5-year CD rates of 1.34%. This compares with an average effective yield and average 5-year CD rate of 1.61% and 1.71% respectively, for the same period one year ago.

Separately, a new report from research firm Hearts & Wallets LLC, Hingham, Mass., finds that investors who use an insurer as their primary firm invest nearly 20% of assets in annuities.

The quantitative survey of more than 4,500 U.S. savers is a representative sampling of the U.S. population.

The report also found that investors who use a bank as their primary provider invest nearly half of their assets in bank products, such as certificates of deposit, FDIC savings or checking accounts.

Among the report’s other findings:

● 46% of investors who have $500,000 or more in investable assets hold annuities.  

● Nearly half of investors ages 21-27 say they don't own investment products.

● 33% of fully employed seniors own annuities, a percentage higher than that of all other age groups..  

● Average annuity allocation grew to 12% in 2011 from 9% percent in 2008 among high-net worth pre/post retirees.

● About one-third (29%) of pre/post-retirees own annuities.  Those who own them invest about one-fifth (21%) of their assets in annuities.

● More than a quarter of pre/post-retirees who do not currently own an annuity or individual bond are interested in these potential income-producing products.  The most important time for product trials is among younger investors, such as Accumulators, ages 20s through 50s.  

Top Sales and Marketing Ideas - 2014

Special Feature

2014 100 Best Sales & Marketing Ideas

There are a million ways to sell an insurance product, and any one of them may work depending on your target market, your product lineup and your own unique skill set.

Explore Now
More Resources

Comments

Advertisement. Closing in 15 seconds.