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RILAs Are Still Breaking Sales Records
Registered index-linked annuities have found fans among near-retirees who still seek growth potential from their assets .
By Ben Mattlin
ACCORDING TO INSURANCE-INDUStry data tracker LIMRA , the only type of annuity that ’ s had record high sales every year since its introduction in 2011 is the registered index-linked annuity , also known as the “ RILA .”
It ’ s not hard to understand why . This variation on variable annuities invests in mutual-fund-like subaccounts , allowing a high degree of market exposure . But unlike traditional variable annuities , the registered index-linked version gives you only a predetermined percentage of the underlying investment ’ s gains , in exchange for limiting how much can be lost if the underlying investment drops in value . Investors who want growth potential and downside protection have been flocking to registered index-linked annuities as an ideal solution .
They offer “ an attractive alternative to fixed-income investments in low-interest-rate environments , and higher caps and participation rates [ than fixed-index annuities ] when interest rates move higher ,” says Frank O ’ Connor , vice president of research at the Insured Retirement Institute , an industry group in Washington , D . C . Fixed-index annuities also cap upside potential and curtail downside risk , but the upside is much more limited .
RILAs , meanwhile , allow you to choose in advance how much of either you want . They can also serve as “ an inflation hedge , due to their higher growth potential ,” O ’ Connor adds .
The growth of the registered index-linked annuity market is truly phenomenal . In the first nine months of 2024 , sales of the product amounted to nearly $ 48 billion , surpassing the total from the entire previous year , according to LIMRA . Full-year
2024 results aren ’ t in yet , as of this writing , but the most recent quarter saw sales grow 35 % year-over-year , marking the sixth straight quarter of record-high sales .
“ Interest in the market continues to expand ,” says Keith Golembiewski , assistant vice president for LIMRA annuity research in Windsor , Conn . “ In 2024 , there were at least seven new entrants into the RILA market while existing RILA carriers enhanced existing products .”
At last count , 22 carriers offered the product , he says . Five years ago , when LIMRA started reporting on RILA sales rankings , there were only 10 carriers .
Moreover , he says , every one of the top 15 annuity providers currently offers at least one registered index-linked annuity product . In the most recent quarter , the top purveyor of RILAs was Equitable Financial , with some $ 10.5 billion in sales of the product , as measured by LIMRA . Coming in at No . 2 , with more than $ 6.8 billion in sales , was Allianz Life of North America . Rounding out the top five , in order of quarterly RILA sales
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