Annuity sales have been soaring for the last few months!
According to LIMRA analysts, the record-breaking annuity sales trend is expected to continue in the coming years. After two decades of sales around $200 billion to $250 billion, 2022 saw a surge to $312.8 billion. LIMRA predicts that this record could be surpassed depending on how 2023 unfolds.
LIMRA’s forecast suggests that protection products will drive growth in the annuity market for the next few years, with sales unlikely to return to previous lower levels. The combination of favorable demographics, such as the increasing number of baby boomers reaching retirement age, and improving equity markets will contribute to positive sales growth until 2027.
Several factors will drive the annuity market, including the momentum experienced in 2022, the demand for products with protection features, and the growing need for guaranteed income. However, declining interest rates may pose a challenge, although economic conditions are expected to improve.
When it comes to specific annuity product categories, LIMRA provides the following breakdown:
Overall, LIMRA’s research indicates that the individual annuity market will continue to gain momentum. The industry should focus on technological and process improvements to meet the growing demand for annuities and enhance experiences for advisors and customers.
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