Fixed annuities sales down 9% in '07

Estimated sales of book value annuities totaled $6.9 billion, while sales of indexed annuities totaled $6.3 billion.
MAR 11, 2008
Estimated sales of fixed annuities totaled $65.1 billion for the 2007 calendar year, a 9% drop from 2006, according to Beacon Research Inc.'s quarterly Fixed Annuity Premium Study. During the fourth quarter, fixed-annuity sales were an estimated $17.4 billion, representing a 4.1% increase from the year-ago period. Breaking sales down by product type, estimated sales of book value annuities totaled $6.9 billion, while sales of indexed annuities totaled $6.3 billion, representing increases in sales of 10.5% and 2.5%, respectively from the year-ago quarter. Sales of market value-adjusted annuities totaled $2.1 billion, representing a 20.1% drop from the year-ago period. Allianz Life led all insurers with $1.6 billion in fixed annuity sales. AIG Annuity Insurance Co. and New York Life rounded out the top three with $1.37 billion and $1.2 billion in sales, respectively. Sales pushed toward longer-rate terms in the fourth quarter. Rate terms of five years or more had an 83.6% share of market value-adjusted sales, up from 81.7% in third quarter. The ten-year interest guarantee period alone had a 16.9% share of sales -representing the highest level since third quarter, 2004. The study was conducted by was based on the sales of 49 insurance companies representing an estimated 88% of the market. Beacon Research is based in Evanston, Ill.

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