Bank Annuity Sales Topped $50 Billion In 2003

Hartford reclaimed second place in banks from Aegon/Transamerica in 2003 with a 35% improvement in annuity sales. Its industry-leading $4.9 billion in VA sales was 54% better than in 2002, while its smaller fixed sales through banks were off 45%.

AXA jumped all the way from 17th to 6th on the strength of a 219% increase in its total FA and VA sales through banks. Its VA sales were up 222%, but it also tripled its smaller fixed premium through banks. During the year, AXA was able to capture substantial market share at some of the largest bank sellers of annuities, including Bank of America, Wachovia and J.P. Morgan Chase.

Pacific Life, like AXA, enjoyed a huge increase in bank annuity sales and a big leap in the rankings. Pacific Lifes sales were up 151% as it gained 10 places to 8^th. The company sells very little in FAs but was the second largest underwriter of VAs in banks in 2003.

New York Life increased its individual annuity sales by 32% in 2003 and moved up one position into the top dozen annuity underwriters in the bank channel. It displaced Western-Southern, which experienced a 12% decline in bank sales. John Hancocks bank annuity sales dropped 45%, pulling it down from 5^th place to 14^th. Nonetheless, JHL sold more than $1 billion in fixed and variable annuities through banks last year.

Last year, 14 companies sold at least $1 billion in individual annuities through banks, compared to 15 in 2002. Those 14 companies accounted for 81% of all bank annuity sales.

Further down the rankings, 3 companies with a traditional agent-distribution focus registered outsized gains in bank annuity distribution.

MetLife, which has added several new selling agreements with large banks, doubled its bank annuity sales while bank sales were up 137% at Prudential and 39% at Mass Mutual. Prudential is achieving substantial sales through its strategic alliance with Wachovia, while Mass Mutual was able to postpone implementing lower minimum guarantees on its FAs until the beginning of 2004.

Kenneth Kehrer is head of a Princeton, N.J., consulting and research firm bearing his name. He can be reached by e-mail at [email protected] .

Reproduced from National Underwriter Life & Health/Financial Services Edition, March 5, 2004. Copyright 2004 by The National Underwriter Company in the serial publication. All rights reserved. Copyright in this article as an independent work may be held by the author.