Variable annuity (VA) sales in the
US continued to power ahead in the first quarter of 2011, rising
24% compared to the first quarter of 2010 to $39.81bn, reported
research and consulting organisation LIMRA.
The growth rate was up on the
year-on-year growth of 17% recorded in the fourth quarter of 2010
when sales totalled $38.5bn. Total VA sales grew 10% in 2010 to
$140.5bn.
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LIMRA assistant vice-president,
annuity research Joseph Montminy commented that the primary driver
of VA sale in the first quarter of 2011 was the positive trend in
the equity market.
He added that the top three VA
companies experienced record sales for the second consecutive
quarter and 16 of the top 20 VA companies improved sales from one
year ago.
The top three writers of variable
annuities were Prudential Financial ($6.185bn sales), MetLife
($5.68bn) and Jackson National Life ($4.553bn), the same rankings
they held in 2010 as a whole. Their respective market shares in the
first quarter of 2011 were 18.27%, 15.23% and 12.21%.
Driven by fixed-rate deferred
products, fixed annuity sales also enjoyed a positive start to
2011, rising 5% compared with the first quarter of 2010 to $20.2bn,
LIMRA reported.
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By GlobalData
This performance was a marked
improvement over 2010 when fixed annuity sales recorded a 27%
decline compared with 2009 to $80.8bn.
The top-three writers of fixed
annuities were American International Group ($2.653bn sales), New
York Life ($1.983bn) and Allianz Life of North America ($1.572bn).
Their respective market shares were 20.2%, 9.82% and 7.78%. Allianz
Life of North America held third position in 2010 (8.81% share),
New York Life second (8.32%) and American International Group third
(7.86%).
The increase in sales of VAs and
fixed annuities in the first quarter of 2011 brought the total
year-on-year increase in annuity sales to 16% to $60bn.
Banks did particularly well on the
back of higher demand for annuities with LIMRA’s research unit
Kehrer-LIMRA reporting that bank annuity sales in the first quarter
of 2011 recorded 22% year-on-year growth to $10bn.
This was the highest quarterly growth rate achieved by banks in
12 years.
