Total third-quarter fixed annuity sales hit $31.7 billion, level with third quarter 2020 results. Year to date, total fixed annuities sales have grown 10% to $98.1 billion.
AIG, New York Life, Global Atlantic Financial Group, Massachusetts Mutual Life and Athene Annuity & Life led the fixed annuity industry in sales, SRI reported.
Third-quarter fixed-indexed annuity (FIA) sales clocked in at the highest levels in two years, SRI reported. FIA sales increased 30% in the third quarter to $17.1 billion. The sales of these products were $47.1 billion in the first nine months, up 14% from the previous year.
“Growing concerns about inflation should boost FIA sales in the coming months as investors seek principal protection with greater investment growth to offset rising inflation,” said Giesing. “SRI is anticipating FIA sales will surpass expectations, growing to over $60 billion by year-end.”
Fixed-rate deferred annuity sales fell to $11.5 billion in the third quarter, down 27% from the third quarter of 2020. Year to date, fixed-rate deferred sales totaled $42.1 billion, 10% higher than in the previous year.
“While fixed-rate deferred annuity sales dropped in the third quarter, these products still offer competitive rates compared with other short-duration investment options available in the market today,” Giesing said. “SRI predicts annual sales of fixed-rate deferred annuities will remain strong until 2025, as more than $150 billion in existing fixed-rate deferred contracts come due.”
Despite the modest increase in interest rates, immediate income annuity sales remain well below sales levels two years ago. Sales of these products were $1.5 billion in the third quarter, up 7% from the third quarter of 2020. In the first nine months of 2021, immediate income annuity sales were $4.4 billion, down 6% from the previous year.
Third-quarter deferred-income annuity (DIA) sales were $510 million, a 22% increase from the third quarter of 2020. Year to date, DIA sales were $1.4 billion, 16% higher than in the same period of 2020.
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The third-quarter 2021 annuities industry estimates are based on SRI’s quarterly annuity sales survey, which represents 91% of the total market.