According to estimates from S&P Global Market Intelligence, individual annuity direct premiums and considerations surged by 21.8% in 2023, marking a third straight year of double-digit growth. The most substantial annual growth rate for this product category since 2002.
"A resilient domestic economy, rising interest rates, and ample supply of attractive products led to outsized expansion in individual annuities during a year of otherwise mixed growth in business volumes for the US life insurance industry." - S&P Global Market Intelligence
The top six individual entities in the individual annuity business each generated year-over-year growth in individual annuity direct premiums and considerations of more than 32% in the fourth quarter of 2023. Athene Holding Ltd.'s Athene Annuity and Life Co. posted year-over-year growth of 73.3%.
"Athene Holding Ltd.'s Athene Annuity and Life Co., which already ranked as the industry's largest annuity writer, posted year-over-year growth of 73.3%." - S&P Global Market Intelligence
Massachusetts Mutual Life Insurance Co. ranked second among individual life entities with its $6.48 billion in fourth-quarter 2023 individual annuity direct premiums and considerations, an increase of 65.3%.
"Massachusetts Mutual Life Insurance Co. ranked second among individual life entities with its $6.48 billion in fourth-quarter 2023 individual annuity direct premiums and considerations, an increase of 65.3%." - S&P Global Market Intelligence
The combination of record issuance of single-premium group annuities to effect pension risk transfers and growth in stable value products amid volatile markets in 2022 set an almost impossibly high bar for the overall group annuity business in 2023.
"The combination of record issuance of single-premium group annuities to effect pension risk transfers and growth in stable value products amid volatile markets in 2022 set an almost impossibly high bar for the overall group annuity business in 2023." - S&P Global Market Intelligence
Direct individual life premiums slipped by an estimated 0.1% in 2023, with the business straddling the break-even line for a second straight year.
"Direct individual life premiums slipped by an estimated 0.1% when normalizing for reporting changes in 2023." - S&P Global Market Intelligence
The Northwestern Mutual Life Insurance Co. posted a 3.7% decline in direct premiums in the individual life line in 2023.
"The Northwestern Mutual Life Insurance Co. posted a 3.7% decline in direct premiums in the business line." - S&P Global Market Intelligence
Overall, the US life insurance industry experienced mixed growth in business volumes in 2023, with individual annuity growth reaching a 21-year high. The resilience of the domestic economy, rising interest rates, and attractive product offerings contributed to the significant expansion in individual annuities. Despite challenges in other segments, the individual annuity business demonstrated remarkable resurgence, with key players like Athene Holding Ltd. and Massachusetts Mutual Life Insurance Co. leading the growth in this category. The outlook for 2024 remains positive, with strong macroeconomic indicators favoring continued success in the sales of individual annuities.