EVANSTON, Ill., June 11, 2012 (GLOBE NEWSWIRE) -- First quarter's income annuity sales climbed almost 23% from a year ago and an income annuity was the quarter's bestselling product for the first time, according to the Beacon Research Fixed Annuity Premium Study. Indexed annuities advanced nearly 9%.
"Both product types did well despite lower interest rates due to demand for guarantees in general and reliable retirement income in particular," said Jeremy Alexander, CEO of Beacon Research. "The success of New York Life's deferred income annuity also helped boost overall income annuity results, and indexed annuity cap rates looked comparatively good relative to CD and annuity fixed rates."
Total fixed annuity sales were $16.9 billion in first quarter 2012. Fixed rate MVAs1 were up 1.6% from the prior quarter, while sales of the other product types declined slightly for an overall decrease of 2.2%. Results were 8.8% behind the year-ago period on lower fixed rate annuity sales.
| Estimated Sales by Product Type (in $ millions) | |||||
| Total |
Fixed Rate Non-MVA |
Fixed Rate MVA |
Indexed | Income | |
| Q1 '12 | 16,943 | 5,253 | 1,368 | 8,166 | 2,156 |
| Q4 '11 | 17,330 | 5,409 | 1,346 | 8,352 | 2,221 |
| % change | -2.2% | -2.9% | 1.6% | -2.2% | -3.0% |
| Q1 '12 | 16,943 | 5,253 | 1,368 | 8,166 | 2,156 |
| Q1 '11 | 18,570 | 7,796 | 1,527 | 7,498 | 1,754 |
| % change | -8.8% | -32.6% | -10.4% | 8.9% | 22.9% |
Great American joined the quarter's top five companies for the first time, coming in fifth. Aviva USA moved up a notch and New York Life advanced two, to take second and third place, respectively. Allianz continued as sales leader, and American Equity remained a top-five company. First quarter results for the top five Study participants were as follows:
| Total Fixed Annuity Sales (in thousands) | ||
| Allianz Life | 1,484,018 | |
| Aviva USA | 1,177,884 | |
| New York Life | 1,059,701 | |
| American Equity | 979,421 | |
| Great American | 773,849 |
In terms of sales by product type and distribution channel, the leading companies were unchanged from the prior quarter.
1 Market Value adjustments (MVAs) pay a premium on withdrawals when interest rates fall and reduce withdrawals when rates rise. Fixed rate non-MVAs are also known as book value annuities.
The success of New York Life's Lifetime Income Annuity made it the first product of its type to be a quarterly bestseller. The other leading products were once again indexed annuities issued by Allianz, Aviva USA and American Equity.
| Rank | Company Name | Product Name | Product Type |
| 1 | New York Life | NYL Lifetime Income Annuity | Income |
| 2 | Allianz Life | MasterDex X | Indexed |
| 3 | Aviva | Balanced Allocation Annuity 12 | Indexed |
| 4 | American Equity | Bonus Gold | Indexed |
| 5 | Aviva | Income Preferred Bonus | Indexed |
"As carriers respond to the low rate environment, we expect to see more MVAs, unbundled product features, and GLWB rollup rates that vary based on credited interest," Alexander concluded.
About the Beacon Research Fixed Annuity Premium Study
The quarterly Study is the first and only source to track and analyze product-level fixed annuity sales on an ongoing basis, and the first to put a decade's worth of historical industry, company and product sales information in an easily-searchable online database at www.annuitymarketstudy.com.
About Beacon Research
Beacon Research tracks fixed, indexed and variable annuity sales, rates and features, and provides web-based systems at www.annuitynexus.com for distributors and insurance companies. Beacon also licenses information and software tools to other platforms. Beacon's fixed annuity benchmark series -- the industry's first -- is available through Ibbotson Associates. Directly and through strategic alliances, Beacon information can be accessed by hundreds of financial institutions and other distributors, as well as thousands of advisors and agents.
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