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Market Share Updates for Fixed, Variable Annuities & Fixed Equity Indexed Annuities

Independent broker dealers are selling a greater percentage of the total annuities market than they did in the past, according to Linda Koco of Insurance News Net.  In the article “Independent B/Ds Gain Annuity Market Share,” it says that their individual market share has been increasing since the study was started in 2006.  IBD’s were the top distributor of variable annuities in 2010, capturing 30% of the market share compared to their 26% in 2006.  With 24% of the market share for variable annuities in 2010, career agents were the second place seller.  This was a slight increase from their 23% market share in 2006.

Although IBD’s hold a relatively small portion of the fixed annuities market, their portion has increased from 4% in 2006 to 6% of the market share.  Their fixed equity indexed annuities portion is also very small, but increased from 1% in 2006 to 2% in 2010.  The bank channel is the top competition for IBD’s in the fixed annuities market, but their share is down to 40%, from a high of 48% in 2008.  Independent agents have a strong hold on the fixed equity indexed annuities market with an 85% market share.  While that is down from their 89% market share in 2006, the IBD’s portion is miniscule in comparison.

Some of the channels lost some of their market share during the study, in addition to the independent agents decline in the fixed equity indexed annuities market.  The bank channel lost the most market share in the variable annuities market, but it isn’t that important overall since their share of that market is fairly low.  Independent agents lost the most in the fixed annuities market, but this is not a surprise since 5 year fixed annuity rates were relatively low over the period studied.  Overall, IBD’s have been squeezing into the annuities market in any way that they can over the past 5 years or so.  LIMRA found that there were approximately 75,000 IBD’s in 2009 selling annuities and making their mark in the industry.

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