Annuity sales continued to show strong momentum in the third quarter of 2024, climbing 29% year-over-year to reach $114.6 billion, according to preliminary data from LIMRA’s U.S. Individual Annuity Sales Survey.
This marks the 16th consecutive quarter of growth in the U.S. annuity market, coming just short of the record set in the fourth quarter of 2023.
Bryan Hodgens, senior vice president and head of LIMRA Research, attributes this ongoing growth to “favorable economic conditions and a rising demand for guaranteed retirement income.” Despite potential future interest rate cuts, LIMRA anticipates that fixed annuities will continue to drive overall sales to record levels through the end of 2024.
Year-to-Date Annuity Sales
For the first nine months of 2024, total annuity sales increased 23%, reaching $331.2 billion. Each segment of the market contributed to this growth:
Fixed-Rate Deferred Annuity Sales
Fixed-rate deferred (FRD) annuities rose 18% year-over-year in Q3, totaling $40.7 billion. Year-to-date (YTD), FRD sales increased 17% to $124.4 billion. Hodgens noted that market volatility in July and August, coupled with expectations of a September rate cut, fueled demand for these products.
Sales of registered index-linked annuities (RILAs) set a new record for the sixth consecutive quarter, growing 37% year-over-year to $17.3 billion in Q3. YTD, RILA sales surged 40% to $48.2 billion. New product introductions and enhancements to existing offerings have helped maintain investor interest, with LIMRA forecasting continued growth into 2025.
Fixed Indexed Annuity Sales
Fixed indexed annuities (FIAs) also achieved record-high sales, rising 54% year-over-year to $34.9 billion in Q3. YTD, FIA sales reached $94.2 billion, a 33% increase. Hodgens highlighted that the demand for downside protection coupled with growth potential has driven significant interest in FIAs, a trend expected to persist through 2025.
Income Annuity Sales
Income annuities posted solid gains in Q3, with single premium immediate annuities (SPIAs) increasing 17% year-over-year to $3.4 billion. Deferred income annuities (DIAs) saw a 40% jump in sales to $1.3 billion. YTD, SPIA and DIA sales grew 7% and 33%, respectively, reflecting strong demand despite shifting interest rates.
Traditional Variable Annuity Sales
Traditional variable annuities (VAs) continued to grow, with Q3 sales up 14% year-over-year to $14.9 billion. YTD, traditional VA sales rose 12% to $44 billion.
Industry Outlook
With preliminary estimates based on monthly reporting covering 83% of the total market, LIMRA’s data underscores the sustained growth trajectory of the annuity industry. Full third-quarter rankings for the top 20 carriers in total, variable, and fixed annuity sales will be released in mid-November following the earnings announcements from participating carriers.
