Sales of registered index-linked annuities and traditional variable annuities sizzled in the first quarter, according to new LIMRA survey data.
Sales of fixed annuities cooled.
The result was lukewarm totals: Overall U.S. sales of individual contracts fell 1%, to $105 billion.
But LIMRA analysts saw increasing investment market volatility changing how consumers were thinking about investment safety. In January, fewer than half of consumers LIMRA polled said they were very concerned about the economy.
“By the end of the quarter, 6 in 10 consumers said they were very concerned about the economy,” Bryan Hodgens, head of LIMRA research, reported.
The market turbulence that hit in March and peaked in early April may have weakened consumers’ sense that the stock market usually goes up.
That could increase the appeal of annuities that offer features that can protect the value of premium contributions or limit the impact of poor investment market performance.