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LIMRA: U.S. Pension Risk Transfer Sales Jump 14% in First Half of 2024
9/5/2024
WINDSOR, Conn., Sept. 5, 2024 —Total U.S. pension risk transfer (PRT) premium was $26 billion in the first half of 2024, 14% higher than prior year results, according to LIMRA’s U.S. Group Annuity Risk Transfer Sales Survey.
In the second quarter, total PRT premium fell 31% year over year to $11.3 billion.
“Last year’s second quarter results were at near record levels. Although second quarter 2024 premium results fell short of last year, historically these results are strong. In addition, the number of contracts sold increased 10% year over year, indicating broad plan sponsor interest continues,” said Keith Golembiewski, assistant vice president, director of LIMRA Annuity Research. “LIMRA is forecasting strong PRT sales in the second half of 2024.”
Single-premium buy-out premium totaled $9.2 billion in the second quarter, down 37% from prior year’s results. There were 183 contracts finalized in the second quarter, 11% higher than prior year. Year to date (YTD), buy-out premium jumped 12% to $23.4 billion. In the first half of 2024, there were 327 buy-out contracts, 16% growth over prior year. This is the highest number of buy-out contracts sold in the first half of the year ever recorded by LIMRA.
In the second quarter. single-premium buy-in premium was $1.9 billion, an increase of 17%. This was based on three contracts sold. YTD, buy-in premium leapt 44% to $2.3 billion from the five contracts completed in the first half of 2024.
Single premium buy-out assets reached $280.2 billion in the second quarter, up 11% from the prior year. Single premium buy-in assets were $8.6 billion for the quarter, 22% higher than in second quarter 2023. Combined, single premium assets were $288.8 billion, an increase of 12% year over year.
A group annuity risk transfer product, such as a pension buy-out product, allows an employer to transfer all or a portion of its pension liability to an insurer. In doing so, an employer can remove the liability from its balance sheet and reduce the volatility of the funded status.
This survey represents 100% of the U.S. Pension Risk Transfer market. Breakouts of pension buy-out sales by quarter and pension buy-in sales by quarter since 2018 are available in the LIMRA Fact Tank.
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