New York Life, Allianz Life Among Indexed, Income Annuity Leaders

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Indexed and income annuity sales increased 3.7 percent to $34.2 billion in 2012, a record high, according to Beacon Research’s “Fixed Annuity Premium Study.”

Income annuity results for Q4 2012 were $2.4 billion, an increase of 7.2 percent from last year and a 0.3 percent increase from Q3 2012. It was the third consecutive quarterly improvement, Beacon said. Year-over-year, income annuity sales increased 8.5 percent to $9.2 billion in their third-consecutive year of growth, and deferred income annuities were responsible for the sequential gain. For Q4 2012, indexed annuity sales were $8.5 billion, a 1.2 percent increase from the same quarter last year, but declined 3.2 percent compared to Q3 2012.

“DIA results topped $1 billion for the first time in 2012,” said Jeremy Alexander, CEO of Beacon Research. “From first to fourth quarter, sales climbed nearly 150 percent. These products often generate more retirement income than other annuity alternatives and are easy to understand. It’s not surprising that growth was so rapid. The need for retirement income was also an important driver of the annual increase in indexed annuity sales.”

Fixed annuity totals for Q4 2012 were $16.2 billion, a 6.5 percent decline compared to the same quarter last year, and a 2.2 percent decline from Q3 2012. For the year, total sales were $66.8 billion, an 11.6 percent decline compared to last year, largely due to sales losses in fixed rate annuities; most issuers chose to maximize margins at the expense of sales, Beacon said.

The top fixed annuity companies in 2012, were Allianz, New York Life, Aviva, American Equity and Security Benefit Life, which entered the top-five for the first-time.

In Q4, Security Benefit Life advanced to top rank, Allianz dropped to second and New York Life remained in third. American Equity advanced to fourth and Lincoln Financial Group rejoined the top five.


Total Fixed Annuity Sales in billions

Security Benefit Life $1.399

Allianz Life $1.247

New York Life $1.122

American Equity $1.069

Lincoln Financial Group $0.908


Sales by Product Type

1. New York Life - Lifetime Income (Income)

2. American Equity - Bonus Gold (Indexed)

3. Allianz Life - Endurance Plus (Indexed)

4. Security Benefit Life - Total Value Annuity (Indexed)

5. Allianz Life - MasterDex X (Indexed)

“We think that 2013 will be another record year for indexed and income annuities,” Alexander said. “But we don’t expect overall fixed annuity sales to change significantly."

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