Indexed annuities' decade-long joy ride came to an end last year. The products saw their first year-over-year sales decline since 2007, dipping 5.4% to $57.6 billion, according to the LIMRA Secure Retirement Institute.
Eleven of the top 15 insurance companies offering indexed annuities lost ground compared with 2016 sales. Allianz Life Insurance Co. of North America — the largest seller — lost the most in dollar terms, shedding $2.7 billion in sales year-over-year. American Equity Investment Life Holding Co. lost the most in percentage terms, at roughly 30%.
The top variable-annuity manufacturers fared a little better, with seven of the top 15 seeing sales declines on the year. Prudential Annuities lost the most in dollar terms, at $2.2 billion, while Transamerica Life Insurance Co. fared the worst in percentage terms, at roughly 28%.
Indexed annuities, as well as variable annuities, which had their lowest annual sales since the late '90s, hit a speed bump in the form of the Department of Labor fiduciary rule, which raised sales standards for the products in retirement accounts. It went into effect in June.