Sales of Annuities at Banks Jumped 31% for the Quarter

By Moore, Michael O'd. | American Banker, August 31, 1999 | Go to article overview

Sales of Annuities at Banks Jumped 31% for the Quarter


Moore, Michael O'd., American Banker


Annuity sales through banks surged 31% in the second quarter, to a record $7.3 billion.

Consumers concerned about market stability sought safety in the guarantees offered by annuities -- while also taking advantage of a slew of product enhancements such as bonus rates, increased death benefits, and dollar cost averaging investment programs.

"It's all these factors working together that made for such a good quarter," said Kenneth Kehrer, a Princeton, N.J.-based consultant who tracks annuity sales.

Variable annuity sales rose 25% in the quarter, to $3.9 billion. Variable products attract consumers who are looking for a degree of security tied to the ability to track market upticks, Mr. Kehrer said.

Fixed annuities, which have languished over the past few years, showed surprising strength in the second quarter. Banks sold $3.4 billion in fixed annuities, a 36% increase over first-quarter sales and the best quarterly results since 1994.

"As the yield curve has steepened, it's made fixed annuities more attractive," Mr. Kehrer said.

The difference in the rate of return between fixed annuities and one-year certificates of deposit grew from 36 basis points in the first quarter to 71 basis points in the second, Mr. Kehrer said.

Special bonus-rate annuities offered by banks and insurers also contributed to higher sales. These annuities lower first-year sales commissions to boost first-year returns and offer a return premium of up to4% for the first year, Mr. Kehrer said.

"The distance between base rates and bonus rates is growing," he said.

American Skandia introduced a 1% bonus on all its variable annuities this year, which helped boost sales, said Bayard Tracy, national sales manager for the Shelton, Conn.-based insurer. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Sales of Annuities at Banks Jumped 31% for the Quarter
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Author Advanced search

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.