Bank sales of annuities up in October

Fixed and variable annuity sales at banks rose to $4.2 billion in October, a 14% gain, according to Kehrer-LIMRA, a subsidiary of LIMRA International Inc. That’s up from $3.7 billion in September, according to the Kehrer-Jackson Monthly Bank Annuity Sales survey. Total bank annuity sales jumped to a 19-month high in October, rising 45% since the start of 2007. The numbers were up 24% year-over-year. Meanwhile, rising sales of fixed annuities in banks during the summer propelled sales to a 14-month high, Dr. Kenneth Kehrer, founder of Kehrer-LIMRA, noted in a statement. A number of events made the product an attractive one for consumers, according to the report, including the fact that in October the average base new money rate on fixed annuities guaranteed for one year beat the average yield on certificates of deposit by 0.0022 points. “October’s spread between the average fixed annuity bonus rate and the average one-year CD rate was the largest since July 2006,” Mr. Kehrer said. Additionally, rising equity markets in October, along with guaranteed retirement income benefits, made variable annuities attractive to customers, raising year-over-year sales by 28%, the report noted.