Filed Under:Annuities, Fixed Indexed

Beacon: fixed annuity sales decline in third quarter

Indexed and income annuities rise for the year

Photo credit: sscreations
Photo credit: sscreations

Sales of all fixed annuities dipped 3.1 percent in third quarter, according to a new report.

Beacon Research, Evanston, Ill., published this finding in the latest edition of its “Fixed Annuity Premium Study.” The report tracks and analyzes fixed annuity sales on an ongoing basis.

Fixed annuity sales totaled $16.6 billion in the third quarter of 2012, down from $17.1 billion recorded in the second quarter of this year. Compared to the third quarter of 2011, fixed annuity sales were down 12.8 percent, declining to $16.6 billion from $19 billion.

However, indexed annuity sales edge up 0.5 percent over the year-ago period, rising to $8.74 billion in the third quarter from $8.69 billion in the third quarter of 2011.

Income annuities also enjoyed a year-over-year gain attaining $2.374 billion in sales in third quarter of 2012, up from $2.226 billion for the year-ago period, a 6.7 percent rise.

Income annuity sales for the third quarter also were 3.8 percent higher than in the second quarter: $2.374 billion versus $2.287 billion, respectively.

However, sales of fixed rate non-market value adjusted (MVA) annuities in the third quarter ($4.434 billion) are down both compared to the second quarter ($4.783 billion) and the year-ago quarter ($6.27 billion).

Likewise, sales of fixed rate MVA products also dipped 13.9 percent during the third quarter, reaching $1.025 billion, compared to $1.191 billion in the second quarter. Compared to the third quarter of 2011, when fixed rate MVA sales totaled $1.46 billion, sales are down 29.8 percent.

For the year, fixed annuity sales in 2012 totaled $50.61 billion, off 13.1 percent from the $58.24 billion recorded in 2011.

However fixed indexed and income annuities sales both rose for the year.

Indexed annuity sales increased to $25.746 billion from $24.626 billion, up 4.5 percent. And income annuity sales rose to $6.816 billion from $6.259 billion, an 8.9 percent rise.

By carrier, Allianz was the top seller with $1.3 billion in fixed annuity sales. Aviva USA, New York Life, Security Benefit Life and American Equity took the second through fifth place positions, garnering $1.064 billion, $1.061 billion, $1.034 billion and $982 million in fixed annuity sales, respectively.

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Nichole Morford

Nichole Morford
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