Annuities hit new $223B high in H1 2025, LIMRA says

The US annuity space is continuing onward and upward with all-time highs in sales, though the latest available figures suggest a slowdown is underway.

Total US annuity sales hit a record $223 billion in the first half of 2025, edging 3% above last year’s pace, according to preliminary data from LIMRA’s latest survey.

The results revealed Tuesday morning, which cover nearly nine-tenths of the annuity market, mark the third consecutive year that both quarterly and year-to-date sales have set new highs. However, industry leaders caution that the momentum may not carry through the rest of the year.

Following a remarkable first quarter, second-quarter annuity sales climbed 5% year over year to $116.6 billion, the highest quarterly total on record.

Consistent with previous reports, registered index-linked annuities (RILAs) were a key driver, with sales surging 20% to $19.6 billion for the quarter and reaching $37 billion for the first half of the year.

“For the third consecutive year, quarterly and year-to-date annuity sales have set records. If you look underneath the top-level results, however, we see a slight softening in the market, which could result in a contraction in the second half of the year,” Bryan Hodgens, senior vice president and head of LIMRA research said Tuesday.

But even under a second-half slowdown scenario, Hodgens said that "annuity sales will likely surpass $400 billion in 2025.”

LIMRA’s data also show that while RILAs continue to gain traction, other segments are experiencing mixed results. Traditional variable annuity sales fell 4% to $14.7 billion in the second quarter, though year-to-date sales rose 3% to $30 billion.

Meanwhile, fixed-rate deferred annuities rebounded from a slow start, with second-quarter sales up 9% to $44.2 billion, but year-to-date totals remained flat at $83.9 billion.

“Although FRD sales have rebounded from the sluggish start in the first quarter, monthly data suggests sales are sliding as interest rates stabilize and likely investors have already secured FRD contracts,” said Keith Golembiewski, assistant vice president and director of LIMRA annuity research.

“Strong equity market growth has dampened new FRD sales. That said, FRD crediting rates, on average, continue to outperform CD rates, making them the most attractive, short-term solutions for risk-adverse investors,” Golembiewski said.

Fixed indexed annuity sales held steady at $31.4 billion for the quarter, with year-to-date sales slipping 1% from last year – a setback Golembiewski said was "due to FRD cannibalization." Still, he said FIAs continue to be compelling for "clients and financial professionals [looking] for guaranteed income and protected growth.”

Income annuities showed more pronounced declines: single premium immediate annuity sales totaled $3.4 billion in the second quarter, unchanged from the prior year, but dropped 8% to $6.5 billion for the first half of 2025.

Deferred income annuity sales fell 7% to $1.2 billion in the second quarter and declined 14% year over year to $2.1 billion for the first half, compared to the record set in the same period of 2024..

Hodgens lauded the "new normal" of US annuity sales topping $100 billion per quarter – with the industry beating that benchmark consistently for seven periods straight – but said the work to educate consumers and advisors on guaranteed lifetime income has to continue.

"Today, just 1 in 5 pre-retirees own an annuity, and nearly half say they won’t have enough guaranteed income to cover basic living expenses," he said.