Baby boomers and seniors nearing retirement increasingly reinforced their post-employment plans with an annuity during the first quarter, pushing sales of the financial product higher from the previous year.
Data from the Insured Retirement Institute showed industry-wide, annuity sales totaled $58.1 billion during the first three months of 2011, up 17 percent from a year earlier. Sales were also up 5 percent from the previous period, while variable annuity sales reached their highest recorded total at $1.6 trillion, said the report.
The report showed more consumers were seeking to make the most of their investment in life insurance by purchasing an annuity.
"With the first wave of the 79 million Baby Boomers turning 65 this year, guaranteed retirement income strategies clearly are being relied upon in growing numbers," said IRI president and CEO Cathy Weatherford. "Recent IRI research shows that 92 percent of Boomers who own annuities have a higher confidence in the financial stability of their retirement compared to those who do not."
Annuities are contracts in which a life insurance company agrees to pay out guaranteed income over a period of time. Consumers are advised to consult with a financial planner before investing in an annuity.