Annuity Sales

Prudential Financial announced first quarter earnings results that blew past estimates. Net income was $536 million compared to a loss of $5 million in the same period a year ago. Net variable annuity sales were very strong with revenue totaling $3.2 billion for the quarter--a significant increase from $665 million a year ago.

The National Association of Insurance Commissioners (NAIC) recently amended its suitability requirements. The amendment makes insurers responsible for ensuring that all types of annuity sales or transactions are suitable. Industry participants are struggling with the increased administrative complexity. As discussed in a recent article in Investment News: “The big change is that it requires a complete secondary review somewhere in the chain of the distribution line up to the company,...

The National Association of Insurance Commissioners (NAIC) has adopted an amendment that will affect the processes involved in determining the suitability of fixed annuity sales. Much of the supervisory responsibility for fixed annuity suitability will be shifted towards the insurance company . Broker -dealers will likely receive much of their guidelines, materials and recommendations from insurance companies. The result is an increase in compliance burden which will likely have the greatest...

The trade Group LIMRA just published a list of the 20 companies that sold the most individual annuities in the United States during the fourth quarter 2009. The list reveals the level of concentration among product manufacturers in the annuity industry.