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Facing continued equity market volatility and higher interest rates, investors expressed more interest in deferred annuity products that offered greater asset protection in 2023, compared with responses in 2021. As advisors work with their clients to develop a holistic financial strategy, it is important to note that a majority of investors are bracing for market uncertainty or a downturn over the next five years.

In early 2023, LIMRA asked more than 2,000 investors (ages 40-80 with at least $100,000 in investible assets) to hypothetically buy one of four annuity products — fixed deferred-rate annuity, fixed indexed annuity, registered indexed-linked annuity and variable annuity — that they would keep for the next five years. This is the second time LIMRA has conducted this experiment.

Fixed-Indexed Annuities (FIA)
Once again, FIAs were the top choice among those surveyed this year. FIAs offer a combination of downside protection and upside investment growth potential that appealed to more than half of investors (51%), up five points from 2021. The study results align with actual annuity sales growth. In 2022, FIA sales were a record-high $79.8 billion. This trend continued in the first quarter of 2023, where FIA sales jumped 43% to $23.1 billion — the best quarter for FIA sales ever recorded.


The top three reasons investors who chose FIAs gave signaled a desire to protect their investment from potential equity market declines:

Fixed-Rate Deferred Annuities (FRD)
Another annuity product that attracted more interest in 2023 was FRD annuities. The proportion of investors who selected an FRD annuity rose to 12%. Given that interest rates have more than doubled since the end of 2021, it is not surprising that more people found the value proposition for FRDs appealing.

Throughout 2022, FRD sales shattered sales records and in the first quarter of 2023, FRD annuity sales topped $41.5 billion, a new quarterly record. Over the past year, these products consistently have offered higher crediting rates than CDs, which are particularly attractive to risk-averse investors who are seeking guaranteed returns. 

Registered Indexed-Linked Annuities (RILA)
While the number of investors who selected RILAs dropped in 2023, it remains the second most popular option. Thirty percent of investors said they would buy a RILA in 2023, down five points from 2021. RILAs offer investors greater potential investment growth while sharing the downside risk with the carriers.

The study found younger investors with higher risk tolerance were more likely to select RILAs. Investors who selected RILAs were almost twice as likely as those who chose FIAs to believe the stock market will perform well over the next five years (30% versus 16%). While sales growth has slowed from the double-digit growth experienced over the past few years, RILA product sales were $41.1 billion in 2022 — an all-time record — and totaled $10.4 billion in the first quarter of 2023, up 8% from the prior year.

Variable Annuities (VA)
Investors surveyed were least interested in VAs. In 2023, just 7% of investors said they would choose a VA, down from 13% in 2021. VAs were more likely to be chosen by younger investors and non-retired workers, who have more time to recover from a market downturn over the next five years. When looking at recent sales results, the sustained market volatility has significantly deterred actual buyers as well. Total VA sales fell 29% to $61.8 billion in 2022, and fell 31% in the first quarter of 2023 to $12.8 billion, marking the fifth consecutive quarter of double-digit declines.

Interest in Annuities Has Never Been Greater
Regardless of the type, LIMRA research shows investors’ interest in annuities has increased over the past five years. Long-term market uncertainty, worries about longevity risk and greater awareness of the protection that annuities offer have shifted investors’ perceptions about these products. Today, more than half of investors (52%) say they would consider including an annuity in their portfolio, compared with just 33% in 2018.


June is Annuity Awareness Month, a time when the industry works together to highlight the important role annuities play to help investors achieve financial security throughout their retirement. LIMRA research shows 7 in 10 retirees who own an annuity are confident that their savings and investments will last should they live to age 90, compared with just 44% of retirees without an annuity. Similarly, 8 in 10 investors — regardless of annuity ownership — agree that lifetime-guaranteed income gives people peace of mind in retirement. Let’s do more to help more Americans achieve that peace of mind.

Media Contacts

Catherine Theroux

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Brooke Lacey

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Bailey Reed

Public Relations/Social Media Specialist

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