Fixed Annuity News

The fixed annuity industry is constantly changing. From product evolution and distribution consolidation to pending regulation and legislation, NAFA works diligently to keep up with every aspect of the marketplace and provide you with its most pertinent news in a timely manner. Utilize the information below to read about recent media coverage in our Monday Media Reports, access monthly advocacy updates via The Call, visit our Press Room for the association’s most current news releases or to catch up on our Twitter feed.

Industry News

DOL Fiduciary Rule Could Throw Cold Water on Annuity Sales Boom
26 FEB – Mirian Rozen – Advisor Hub

“Annuity sales keep breaking records and hit an all-time high in the fourth quarter of last year, but the Department of Labor’s proposed fiduciary rule governing retirement accounts threatens to rein in the party.

The change could be felt most acutely by some of the largest independent broker-dealers, such as LPL Financial, Ameriprise Financial and Raymond James Financial, which control almost a third of the advisor-sold annuities market, according to a 2022 Cerulli Associates report. (In comparison, wire houses account for around 9% of annuities sold by advisors.)”

Will lower interest rates cut into fixed deferred annuity sales?
27 FEB – Rayne Morgan – Insurance News Net

“Although annuity sales are still seeing record highs, investor interest may eventually shift away from fixed-rate deferred annuities and towards other annuities products that have more growth potential if the Federal Reserve cuts interest rates as expected, according to industry experts such as LIMRA.

Fixed-rate deferred annuity products sales are strongly leading the pack and experts expect that trend will likely continue for some time. However, Bryan Hodges, LIMRA head of research, said lower interest rates also mean lower interest rates on products like fixed deferred annuities. This may make them “a little bit less attractive” to investors, he said.”

California’s Adoption of NAIC Annuity Protection Model Means 90% of U.S. Consumers Now Covered
1 MARCH – Brian Anderson – 401K Specialist

“Some insurance industry experts are saying that California’s adoption this week of the National Association of Insurance Commissioners (NAIC) best interest model for annuity transactions further negates the need for the DOL’s proposed retirement security rule.

The fact that California—a blue state with the largest population of any state in the country—this week became the 45th state to adopt the best interest regulation that insurance producers must follow when recommending annuity products to their clients may have some deeper implications than being just another state to adopt the model.”

American Council of Life Insurers: California Strengthens Protections for Annuity Consumers
2 MARCH – AP – Insurance News Net

“The American Council of Life Insurers (ACLI), Association of California Life and Health Insurance Companies (ACLHIC), National Association of Insurance and Financial Advisors (NAIFA), Finseca, Insured Retirement Institute (IRI), National Association for Fixed Annuities (NAFA), Federation of Americans for Consumer Choice (FACC), and Independent Insurance Agents & Brokers of California (IIABCal) issued the following statement today on a new California law that enhances protections for annuity consumers:”

Annuity Sales Are Soaring Because of Higher Payouts. What You Need to Know.
3 MARCH – Debbie Carlson – Barron’s

“Higher interest rates are making annuities of all stripes more attractive, allowing buyers a chance to protect their principal and lock in yield before payouts decline.

Sales of the insurance product hit a record in 2023 as the combination of volatile equity and bond markets and higher payouts propelled buyers to seek annuities, says Bryan Hodgens, head of LIMRA research, an industry group.”

Multi-Year Guaranteed Annuity Sales Get Back on the Rocket
5 MARCH – Allison Bell – Think Advisor

“U.S. life insurers refilled their tanks of multi-year guaranteed annuity capital in the fourth quarter of 2023.

Life insurers let sales of the products rocket up to $53 billion in the quarter, up 48% from the total recorded in the fourth quarter of 2022, after increasing just 13% in the third quarter of 2023, according to a new issuer survey compiled by Wink.”

Hurt by inflation, Americans yearn for pensions in retirement. One answer may be annuities.
5 MARCH – Medora Lee – USA Today

“Inflation continues to ravage Americans’ savings, making them nostalgic for a retirement benefit of yesteryear: the pension.

Ninety percent of Americans saving in a company retirement plan, such as a 401(k), worry it doesn’t provide a reliable stream of income that can withstand the financial strains posed by inflation, which hit a 40-year high in 2022, according to a survey of 1,003 plan participants last fall by Greenwald Research. Seventy-six percent, up six percentage points from a year ago, worry they’ll run out of money, and 83% now want guaranteed lifetime income, the poll by the independent researcher said.”

Annuity sales set more records in Q4, break $100B, Wink reports
6 MARCH – John Hilton – Insurance News Net

“Annuity sales smashed through the $100 billion barrier in the fourth quarter, Wink, Inc. reported today, setting more records along the way.

Total Q4 sales for all deferred annuities were $105.4 billion, up 33.1% compared to the previous quarter and up 32.9% compared to the same period last year. All deferred annuities include the variable annuity, structured annuity, indexed annuity, traditional fixed annuity, and multi-year guaranteed annuity (MYGA) product lines. “

Annuity Rates in California
7 MARCH – Jennifer Schell – Annuity.Org

“According to the state’s insurance department, California is the largest insurance market in the country and the fourth-largest insurance market in the world. The state is considered a prime market for annuity prospects because the demographic most likely to purchase annuities – residents aged 45 to 64 with over $100,000 in household income – make up 18.2% of California’s total population.”

DOL Sends Final Fiduciary Rule to OMB
8 MARCH – Groom Law – Groom Law Group

“On March 8, 2024, the Department of Labor (“DOL”) sent a final version of the Retirement Security Rule: Definition of an Investment Advice Fiduciary (the “Fiduciary Rule”) to the Office of Management and Budget (“OMB”) for review.  OMB review is typically the final stage of the regulatory process before the publication of a final rule and can take anywhere from a few days to several months.  Assuming a normal review process, we would expect the Fiduciary Rule to be released by the end of May.  The text of the Fiduciary Rule will not be publicly available until it is released by DOL or published in the Federal Register.”

Monday Media Report

Monday Media Report

The NAFA Media Report features a summary of the previous week’s fixed annuity media coverage. NAFA welcomes your contributions and suggested additions.

Access the most current report »

The Call

The Call

The Call features timely and seasonal regulatory and legislative updates to help NAFA members stay on top of issues impacting their businesses. Both federal and state editions are distributed to keep you informed.

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