The guaranteed living benefit rider for variable annuities has become increasingly popular, according to National Underwriter’s “VAs with GLB Rider Rose 18% in 2Q.” Variable annuity products with the GLB accounted for $20.3 billion of new deferred sales during the second quarter of this year. This was an 18% increase over first quarter sales. It was the third quarter in a row that 87% of investors opted for the guaranteed living benefit rider when purchasing their variable annuity products. LIMRA of Windsor, Connecticut performed the study of 27 different carriers representing 95% of the industry sales in the second quarter.
Other guaranteed benefits were elected about the same percentage of time as in the past. The guaranteed lifetime withdrawal benefit was elected 64% of the time. Guaranteed minimum income benefits were chosen in 17% of cases. Both the guaranteed minimum accumulation benefit and guaranteed minimum withdrawal were chosen 3% of the time. The variable annuity assets with the GLB rider actually went down 3% to $427 billion in the second quarter as did the total variable annuity assets which went down 5% to $1.36 trillion. GLBs were available in deferred variable annuity contracts that generated $23.2 billion in premiums. The guaranteed living benefit rider is really seeing a rise in popularity because of its lifetime benefits.