U.S. sales of annuities of all types reached $58.4 billion in the second quarter, a 10.8 percent increase from $52.7 billion in the first quarter, according to newly released data reported by Beacon Research and Morningstar Inc. and interpreted by the Insured Retirement Institute (IRI). The second-quarter sales represent a 2.5 percent decline from same-quarter 2014 figures.
Variable annuity total sales rose sharply to $35.6 billion in the second quarter, representing an 11.7 percent increase from $31.8 billion in the first quarter but virtually unchanged from the second quarter of 2014, according to Morningstar.
"In recent years, the second quarter has been particularly strong, and this year was no exception, with both fixed and variable annuity sales posting large increases from Q1," explained Cathy Weatherford, IRI president and CEO. "As expected, slightly higher interest rates and continued consumer demand for lifetime income supported strong sales across the market during the second quarter. In the VA market, robust sales helped swing VA net flows back into positive territory, reversing the trend of the prior three quarters."
Fixed annuities were the big winners in the second quarter, with sales totaling $22.8 billion, a 9.5 percent increase from $20.9 billion during the first quarter. Beacon Research president Jeremy Alexander noted that the strong overall sales in Q2 reflected gains in all product types.
