Limra projects strong annuity sales through 2027 despite expected declines

A new annuity sales data release from Limra officially confirms a banner year in 2024, with new projections of continued near-term strength for the industry.

In its latest retail annuity sales report, featuring finalized data from 2024, Limra said sales grew 12 percent in the year to hit a record $432.6 billion, just slightly off from the preliminary count of $432.4 billion it released in January.

Fourth-quarter sales were $100.6 billion, up slightly from the previously reported $100.4 billion. Registered index-linked annuity (RILA) sales were also revised upward, totaling $65.4 billion for the year, a 38 percent increase from 2023.

As total quarterly annuity sales breached the $100-billion mark in all four quarters of 2024 – a historic first – the industry notched its third straight year of record annuity sales, with annuities raking in $1.1 trillion over the past three years. 

While Limra doesn't expect future sales to match the record highs of the past two years, industry demand remains strong.

"The past few years have transformed the annuity market," Bryan Hodgens, senior vice president and head of Limra research said in a statement. "Although we don’t expect sales at the levels seen the past two years, Limra predicts total annuity sales to be well above $350 billion in 2025."

In line with its January analysis, Limra highlighted a shift in the market as falling interest rates weakened demand for fixed-rate deferred and income annuities, while equity-linked products like RILAs gained momentum. Notably, RILA sales surpassed traditional variable annuity sales for the first time, reflecting investors’ preference for products balancing growth potential with downside protection.

"Given the current market uncertainty, RILA products have carved out a nice place along the product risk spectrum, positioned between traditional variable annuities and fixed index annuities," Hodgens noted.

Despite much-anticipated rate cuts by the Federal Reserve, Limra expects FRD sales to remain above $120 billion in 2025, as conservative investors continue to seek principal protection. Meanwhile, competition and product innovation are likely to sustain demand for fixed indexed annuities and RILAs well into the future.

"Driven by greater competition and continuous product innovation, RILA sales have exploded over the past decade — from $3.7 billion in 2015 to $65.4 billion in 2024,” Hodgens said, highlighting how RILAs have found their place between traditional VAs and FIAs amid the current market volatility.

Limra's latest data package also drilled down into sales data among annuity carriers, with more than half experiencing double-digit sales growth over the course of 2024.

"This was a remarkable year for the US annuity market, with nearly 80% of participating carriers reporting positive growth," Hodgens said.

The sales wins weren't quite as equal on a pure dollar basis. Out of the industry-wide sales haul of $432.6 trillion for 2024, Limra said the top 20 providers reeled  in $316.6 trillion, representing 73 percent of the total sales pie. The picture was even more skewed for variable annuities, where the top 20 names took 94 percent of the $126.2 trillion that went into the category.

According to Limra's breakdown, Athene topped the sales leaderboard of annuity providers overall, attracting nearly $36 trillion. Corebridge was a distant second with $26.6 trillion in annuity sales, while MassMutual followed close behind with $24 trillion. Things weren't so different in the fixed annuity segment with Athene again taking the lead, while MassMutual took second place ahead of Corebridge.

The race played out quite differently in the variable annuities space, as Equitable Financial took top spot with $22.5 trillion in VA sales. Jackson Financial took second with $15.2 trillion, while Lincolkn Financial came in third with $9.3 trillion, just ahead of the rest of the pack.