According to Insurance News Net’s article “Annuity Sales Post Double Digit Increase,” variable annuity assets are at the highest level ever. The guaranteed income from annuities has made them very popular, especially with the millions of baby boomers who retire each year. The Insured Retirement Institute found that 92% of those who have annuities have a high confidence in their financial stability during retirement. The trend of purchasing annuities has been increasing during the first quarter of this year and it is forecasted to continue throughout the year.
Total annuity sales for the first quarter of this year were 17% higher than total annuity sales last year. There was also an increase from the fourth quarter of last year of 5%. Total variable annuity assets are now $1.6 trillion, which is the highest level that has ever been recorded in history. Variable annuity sales increased 4% from the fourth quarter of last year and saw a dramatic 23% increase from the first quarter of last year to the first quarter of this year. Fixed annuity sales increased 7% from the fourth quarter of last year to the first quarter of this year and 6% from the first quarter of last year.
As sales and net cash flow both increased with variable annuity products, it seems to be due in part to better education of advisors. The more they learn about death benefit annuity and other variable annuity products, the better able they are to explain and sell them to retirees. Baby boomers and others nearing retirement are feeling comfortable with their future finances when they are invested in annuities that will last over their lifetime, and in the case of a death benefit annuity, their inheritant’s lifetime.