Higher Stock Prices and Worried Investors Boost Q2 Annuity Sales

Rising stock prices, good rates and investors’ memories of past stock market woes helped insurers increase U.S. individual annuity sales 25%, year over year, to $109 billion in the second quarter of 2024.

Sales of registered index-linked annuities, or annuities with returns tied to the performance of entire stock indexes, rather than mutual fund-like baskets of stocks, climbed 42% from the year-ago period, according to new survey data from LIMRA.

Regulatory changes and the need for retiring baby boomers to convert retirement assets into streams of income led sales of deferred income annuities to soar 62%.

What It Means

Bryan Hodgens, a senior vice president at LIMRA, said relatively high interest rates and other favorable economic conditions have made annuities more attractive.

“We also believe demographic trends and a growing awareness of the unique value proposition annuities offer have shifted the U.S. annuity market post-pandemic,” Hodgens said.

Because of those trends, clients may be somewhat more open to including annuities in their portfolios.