FIA, MYGA Products Stay Strong as Annuity Awareness Month Begins

According to LIMRA, total U.S. annuity sales were $113.5 billion in the first quarter of 2024, 21% above prior year results and just shy of the quarterly sales record set in the fourth quarter of 2023, according to preliminary results from LIMRA’s U.S. Individual Annuity Sales Survey, representing 84% of the total U.S. annuity market. These are the highest first quarter sales results since LIMRA started tracking sales in the 1980s.

Propelled by $286.6 billion in fixed annuity sales, total U.S. annuity sales also reached a record-high $385.4 billion in 2023, jumping 23% year over year, according to final results from LIMRA's U.S. Individual Annuity Sales Survey.

With these sales numbers in mind, June kicks off Annuity Awareness Month, which provides an opportunity to educate consumers about the advantages of annuities as a complement to a client’s or prospect’s retirement strategy. As more people look for protection against inflation and fluctuating economic conditions, annuity products can provide guaranteed accumulation with locked-in rates or even guaranteed lifetime income.

AIP Marketing Alliance focuses its annuity products on short-term and long-term options for agents to sell to customers and prospects. Sticking to a philosophy of protection, most of AIPMA’s selected carriers focus on fixed annuities (FA), fixed indexed annuities (FIA), multi-year guaranteed annuities (MYGA), or single premium immediate annuity (SPIA) products.

LIMRA’s statistics seem to support the current appetite for these annuities. According to LIMRA, FIA sales had a record first quarter, as sales totaled $29.3 billion, up 27% from the prior year. Income annuity product sales set a quarterly record due to rising interest rates as SPIA sales were $4 billion in the first quarter, 19% higher than the prior year’s results.

Since June focuses on annuity awareness, let’s take a moment to share some information about these products.

• Fixed Annuities: The consumer will lock in an interest rate and receive guaranteed minimum payouts later in life, distributed in an amount that will be specified in his/her contract.
• Fixed Indexed Annuities: A FIA ties the determination of credited interest to a market index; S&P for example. The FIA’s principal and interest already credited are not subject to loss from market downturns.
• Multi-Year Guaranteed Annuities: A MYGA works like a bank CD, with a guaranteed rate of return for a specific period with tax-deferred earnings. MYGAs are not insured by the Federal Deposit Insurance Corporation (FDIC) but are guaranteed by life insurance companies. A MYGA can also provide a death benefit for your clients’ beneficiaries.
• Single Premium Immediate Annuities: A SPIA skips the accumulation stage and begins paying out income either immediately or within a year after your client purchased the SPIA with a single, lump-sum payment. Clients also can make larger contributions without the limitations of similar retirement plans (i.e., 401(k), IRA).

For AIPMA wholesalers and agents, you can leverage the Accelerate on-demand video training platform to learn more about annuities. The training sessions range from talking about specific products (FIA, FA, etc.) to annuity options (participation rate, caps, point-to-point strategies, etc.). Agents with annuity contracts have access to this Accelerate platform through AIP Marketing Alliance.

Do you have clients interested in buying annuities? Do you want to start selling annuities? Contact AIPMA’s Business Development team at (800) 783-5206 Press #2 or [email protected]. Our professional staff can show you how to do MORE in ’24 by helping you to get started selling annuities, assist with carrier contracting, and share some tools and strategies for positioning annuities with clients and prospects.

For more than 40 years, AIP Marketing Alliance (AIPMA), an Integrity Company, serves as a premier life insurance and annuity distribution partner to provide full-service support to independent wholesalers, brokerages and agents from our Troy, Michigan office. NOT AFFILIATED WITH OR ENDORSED BY THE GOVERNMENT OR THE MEDICARE PROGRAM.

AIP Marketing Alliance is committed to?MORE in ’24?as we are launching a bunch of new resources to support our independent insurance wholesalers and agents.?Visit our blog on aipma.com?to stay informed on these upcoming launches and learn why wholesalers nationwide choose AIPMA as their distributor for selling life insurance, annuities, long-term care insurance, final expense, and much more. Ask about our lead services, myAIP CRM platform with customizable recruiter portal, and online tools/resources designed to grow your business.

AIP Marketing Alliance, an Integrity Company, has developed this electronic communication for informational and educational use only. Be advised, AIP Marketing Alliance, Inc. does not provide legal advice, tax advice, or guidance on issues involving securities laws, insurance laws nor securities or insurance regulations. This material should not be relied on as providing any such advice or guidance to either agents or retail consumers. Within this communication, AIPMA shares links for usage as information only. This content should not be interpreted as solicitation to purchase life insurance, annuities, or other products or as advice designed to meet your clients’ specific needs. Content involving fiduciary, tax, or legal advice should be directed to your legal, tax, and financial professionals for specific advice or product recommendations. AIPMA will not accept any legal liability resulting from any use of 3rd party material(s).