Annuity sales surge 39% in second quarter

Variable annuity sales jump 55% to $32.8 billion in Q2, marking the highest quarterly sales in that category in nearly six years, according to the Secure Retirement Institute.

Sales of annuities reached $67.9 billion in the second quarter, up 39% from the second quarter of 2020, according to data gathered by the Secure Retirement Institute. Year-to-date, annuity sales totaled $129 billion, 23% higher than in the same period in 2020, SRI said in a release.

“Strong equity market gains and lower volatility, as well as rising interest rates all contributed to the rebound,” Todd Giesing, assistant vice president at SRI, said in the release. “The last time quarterly annuity sales surpassed this level was in the fourth quarter of 2008.”

By product type, total variable annuity sales were $32.8 billion during the quarter, up 55% from 2020, representing the highest quarterly VA sales in nearly six years. In the first six months of 2021, total variable annuity sales were $62.8 billion, 33% higher than in 2020.

Traditional VA sales were $22.7 billion, a 37% increase from second quarter 2020. Year to date, traditional VA sales totaled $43.6 billion, up 16% from the prior year.

Registered index-linked annuity sales exceeded the record $9.2 billion in sales in the first quarter to post $10.1 billion in sales in the second quarter, marking a 122% jump from the second quarter of 2020. For the first half of 2021, RILA sales were $19.3 billion, which was 105% higher than the prior year.

Fixed indexed annuity sales grew 28% in the second quarter to $15.4 billion. Year to date, FIA sales were $28.9 billion, up 2%.

Fixed-rate deferred annuity sales were $16.1 billion in the second quarter, 26% higher than the prior year results. This represents the highest quarterly sales results for fixed-rate deferred annuities since the second quarter of 2009. In the first six months of 2021, fixed-rate deferred annuity sales totaled $30.7 billion.

Immediate income annuity sales were $1.8 billion in the second quarter, up 29% from second quarter 2020. Year to date, immediate income annuity sales were $3.3 billion, level with prior year results.

Deferred annuity sales increased 52% to $540 million in the second quarter. While interest rates have improved, they remain very low, undermining interest in income annuity products. In the first half of 2021, DIA sales were $1 billion, 17% higher than prior year.

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