The newly created Analytic Reporting for Annuities service of the Insurance & Retirement Services division of the Depository Trust & Clearing Corporation, has issued data on annuity sales in the first quarter of 2012. A pdf of the report includes charts that summarize the data described below.
I&RS said it processed 12 million annuity transactions totaling over $38 billion for:
- 106 insurance company participants (representing 42 parent/holding companies
- 111 broker/dealers
- 2,954 annuity products
Inflows for the quarter totaled almost $21 billion, outflows totaled almost $18 billion, and net cash flows totaled over $3.3 billion. The transactions processed by I&RS reflect the activity at a broad range of broker/dealers, with a particular concentration in non‐proprietary distribution.
The top ten insurance parent/holding companies captured $16 billion of inflows, or 77% of total inflows in the first quarter. Twenty-four insurance parent/holding companies accounted for over $8.3 billion in positive net cash flows for the quarter. Eighteen insurance parent/holding companies experienced negative net cash flows totaling over $5.2 billion.
Products
Of the 2,954 annuity products for which I&RS processed transactions:
- 579 products had positive net flows totaling more than $16 billion.
- 2,372 products had negative net flows totaling more than $13 billion.
- 34 products had more than $100 million in positive net flows.
- 2 products had more than $1 billion in positive net flows.
- The top 10 annuity products captured 38% of all inflows.
Cash flow retention
Net flows ranged from a high of $2 billion to a low of ‐$1.6 billion. Sixteen of the 42 insurance parent/holding company groups had a retention ratio of more than 50%, meaning that there was $2 or more of inflows for every $1 of outflows. The retention rate of cash flows in qualified account types far exceeded that of non‐qualified accounts, which had negative net cash flows for the quarter.
Inflows by type of account
The divergence of inflows between qualified accounts and non‐qualified accounts continued in March. Inflows into qualified accounts were slightly less than 61% while inflows into non‐qualified accounts were slightly above 39%. Sixty-one percent of all inflows went into qualified accounts and 39% went into non‐qualified accounts.
Distribution
Six distributors, out of a total of 111, had more than $1 billion in annuity inflows. The top 10 distributors accounted for two thirds of all inflows.
© 2012 Depository Trust & Clearing Corp.
