VA Flows Jump

 

By WARREN S. HERSCH

Published 4/28/2011 

The flow of new assets into U.S. variable annuities increased 10% in 2010, to about $137 billion, according to the Insured Retirement Institute.

IRI, Washington, published that finding in a summary of results from a survey of VA sellers. The results were compiled by a unit of Morningstar Inc., Chicago.

VA contracts held $1.5 trillion in assets at the end of 2010. The asset total was the highest IRI has recorded. The previous record high was posted in the third quarter of 2007, before the economic crisis began, IRI says.

IRI found that VA fee levels have remained steady over the past 5 years.

VA fees amounted to an average of 2.49% of VA assets, down slightly from 2.51% in 2009.

In related news, IRI says the VA issuers that participated in the survey filed only 49 product changes in the first quarter of 2011, down from 140 in the first quarter of 2010.

Lifetime guaranteed minimum withdrawal benefit features continue to be popular among product developrs and VA distributors. All 13 living benefits filed in the first quarter this year were designed as lifetime withdrawal riders, IRI says.