Filed Under:Markets, Company News

Annuity sales slump lingers into Q1

Overall annuity sales continued their downward arc in the first quarter, according to several recently released statistical reports. But there were some rays of light peeking through the clouds.

Industry-wide, annuity sales in the first quarter totaled about $49.6 billion, down 2 percent from $50.6 billion in the final quarter of last year and a 6.6 percent drop from Q1 2012 when sales amounted to $53.1 billion, reports the Insured Retirement Institute (IRI).

Meanwhile, results varied within the broader fixed annuity category. Fixed-rate MVA sales slid down nearly 29 percent from $1.4 billion in the first quarter of last year to $972 million in Q1. Yet, when compared to the fourth quarter of 2012, when fixed-rate MVA sales hit $999 million, the most recent tally was only a drop of 2.7 percent. That slight dip, Beacon Researchers speculate, may be because consumers are more apt “to accept some potential interest rate risk in exchange for higher credited rates.”

Similarly, fixed-rate non-MVA sales registered a 23.5 percent year-over-year decline, going from $5.3 billion in Q1 2012 to $4 billion in Q1. That represents an 8.1 percent decrease from Q4 2012 when sales equaled about $4.4 billion.

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Nichole Morford

Nichole Morford
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