Income annuity sales increased more than 22 percent in the first quarter of 2012 and for the first time, an income annuity was the top selling product, according
“Both product types did well despite lower interest rates due to demand for guarantees in general and reliable retirement income in particular,” said Jeremy Alexander, CEO of Beacon Research. “The success of New York Life’s deferred income annuity also helped boost overall income annuity results, and indexed annuity cap rates looked comparatively good relative to CD and annuity fixed rates.”
According to Beacon, total fixed-annuity sales for Q1 2012 were $16.9 billion; fixed rate market value adjustments (MVA) increased 1.6 percent from the prior quarter.
Sales volume for other product types declined 2.2 percent overall.
Compared with the same period last year, sales of fixed rate annuities declined 8.8 percent.
| Estimated Sales by Product Type (in $ millions) | |||||
|---|---|---|---|---|---|
| Total | Fixed Rate Non-MVA | Fixed Rate MVA | Indexed | Income | |
| Q1-'12 | 16,943 | 5,253 | 1,368 | 8,166 | 2,156 |
| Q4-'11 | 17,330 | 5,409 | 1,346 | 8,352 | 2,221 |
| % change | -2.2% | -2.9% | 1.6% | -2.2% | -3.0% |
| Q1-'12 | 16,943 | 5,253 | 1,368 | 8,166 | 2,156 |
| Q1-'11 | 18,570 | 7,796 | 1,527 | 7,498 | 1,754 |
| % change | -8.8% | -32.6% | -10.4% | 8.9% | 22.9% |
Great American joined the quarter’s top five companies for the first time, coming in fifth. Aviva USA moved up a notch and New York Life advanced two, to take second and third place, respectively. Allianz continued as sales leader, and American Equity remained a top-five company. First quarter results for the top five study participants were as follows:
| Total Fixed Annuity Sales (in thousands) | |
| Allianz Life | 1,484,018 |
| Aviva USA | 1,177,884 |
| New York Life | 1,059,701 |
| American Equity | 979,421 |
| Great American | 773,849 |
Ranking companies were unchanged, in terms of sales by product type and distribution channel, from the prior quarter.
New York Life’s Lifetime Income Annuity is the first product of its type to be a quarterly bestseller.
| Rank | Company Name | Product Name | Product Type |
| 1 | New York Life | NYL Lifetime Income Annuity | Income |
| 2 | Allianze Life | MasterDex X | Indexed |
| 3 | Aviva | Balanced Allocation Annuity 12 | Indexed |
| 4 | American Equity | Bonus Gold | Indexed |
| 5 | Aviva | Income Preferred Bonuse | Indexed |
“As carriers respond to the low rate environment, we expect to see more MVAs, unbundled product features and GLWB rollup rates that vary based on credited interest,” Alexander said.
