A period of flux for indexed annuities
Pleasant Hill, Iowa. -Forty-five indexed annuity carriers participated in the 60th edition of AnnuitySpecs.com’s Indexed Sales & Market Report, representing 99% of indexed annuity production. Total second quarter sales were $8.7 billion, up more than 8% from the previous quarter. As compared to the same period last year, sales were up nearly 6%. “This quarter’s sales were only 0.60% lower than third quarter 2010’s record-setting indexed annuity sales levels,” said Sheryl J. Moore, President and CEO of Moore Market Intelligence, the firm that owns AnnuitySpecs.com. “That being said, second quarter was a period of flux for indexed annuities; nine different companies made changes to their products on 14 different occasions during this quarter! Yet once again, agents selling indexed annuities pushed-through the challenge, and focused on informing their clients on the guarantees of indexed annuities…looks like it worked!”
Worth noting this quarter was the fact that Allianz Life maintained their position as the #1 carrier in indexed annuities with a 16% market share. Aviva maintained their position as the second-ranked company in the market, while American Equity, Security Benefit Life, and Great American (GAFRI) rounded-out the top five, respectively. Security Benefit Life’s Secure Income Annuity was the #1 selling indexed annuity for the quarter; an impressive feat (coupled with the company’s sales ranking), given that the carrier entered the indexed annuity market for the first time less than one year ago. Despite declining fixed interest rates and a transition to income sales, Guaranteed Lifetime Withdrawal Benefit (GLWB) elections dropped this quarter to 53% of total indexed annuity sales. The riders are increasingly being utilized to guarantee income; however, the bulk of the changes to annuity products in the second quarter affected the relative competitiveness of these annuity benefits.
For indexed life sales, 48 insurance carriers participated in the AnnuitySpecs.com’s Indexed Sales & Market Report, representing over 99% of production. Second quarter sales were $303.6 million, an increase of nearly 19% as compared to the previous quarter. In contrast to the same period in 2011, sales were up nearly 45%. Ms. Moore remarked, “This quarter, the level of indexed life premium sold was nearly record-setting, coming-in second only to fourth quarter 2011’s mind-blowing sales levels.” She went on to comment, “..and this isn’t slowing-down any time soon. A ton of companies are still doing research and development on their pending products and the distribution landscape for indexed insurance products is changing swiftly. It is an exciting time for those who have indexed life and/or indexed annuities in their toolboxes!”
Items of interest in the indexed life market this quarter included Aviva retaining their #1 position in indexed life, with a 15% market share. AXA Equitable kept the position as second-ranked company in the market, while Pacific Life Companies, AEGON Companies, and National Life Group rounded-out the top five companies, respectively. AXA Equitable’s Athena Indexed UL was the #1 selling indexed life insurance product for the fifth consecutive quarter. Average target premiums on indexed life increased to $9,070.00 for the quarter.