Indexed annuities sales at banks hit record high
By National Underwriter
By Maria Wood
Second-quarter statistics from the Bank Insurance & Securities Research Associates (BISRA) underscore the continued sales growth of indexed annuities.
In Q2, indexed annuities sales through banks and credit unions maxed out at a record high of $1.06 billion, one-third higher than in the first quarter and two-thirds above the number recorded a year earlier in the same quarter. Further, according to BISRA, indexed annuities accounted for one-third of all bank-sold fixed annuities for the first time. Fixed annuity sales came in at $3.2 billion in the second quarter, up from $2.7 billion in the second quarter, but down from the $3.3 billion booked in Q2 ’12.
BISRA’s findings mirror those calculated by LIMRA, which charted a second-quarter indexed annuity sales total of a first-ever $9 billion. That’s a 5 percent jump from the second quarter of last year. Year-to-date, indexed annuity sales rose 1 percent to $16.8 billion, reports LIMRA.
BISRA notes that the bank channel share of indexed annuity sales was 12 percent in the second quarter, another record. In 2008, banks accounted for only 4 percent of indexed annuity sales.
In a release, Janet Cappelletti, head of research at BISRA, states that indexed annuity sales slumped after reaching nearly $900 million in the third quarter of 2009. Now, sales are surpassing that level, due to consumers desiring some upside with the Dow over 15,000, yet willing to bypass some gains in order to have downside protection, Cappelletti says.
She adds that although sales of the broader fixed annuity category have been “see-sawing,” indexed annuities have shown consistent growth over the past six quarters.
These quarterly results for indexed annuity could portend a better year for overall annuity sales. In 2012, bank-sold annuities plunged to their lowest point since 1999, with total annuity sales via banks totaling $29.6 billion, BISRA reported earlier this year.
Originally published on LifeHealthPro.com