Why annuity sales hit records

U.S. annuity sales have set records for four years running, mostly because higher interest rates made guaranteed returns attractive again while millions of baby boomers reached retirement age. According to LIMRA, total U.S. annuity sales reached $461.3 billion in 2025, up 6% from 2024, and the first half of 2026 set another first-half record.

A record in sales is not a recommendation. It means more people are buying, which raises the stakes for understanding what is being bought.

The numbers

LIMRA tracks total premium paid into new annuity contracts, so sales include money moved from other annuities and from bank accounts, not only new savings.

Quarterly sales have exceeded $100 billion for 11 consecutive quarters through mid-2026. LIMRA reported that second-quarter 2026 sales were $121.2 billion, up 2% from a year earlier, and first-half 2026 sales were $228.7 billion, up 1%, in its final second-quarter release. An earlier preliminary release had put the quarter at $123.9 billion because it covered a smaller share of the market; the final figures are the ones to use.

What drove the records

Interest rates. After years of near-zero rates, the Federal Reserve's increases starting in 2022 lifted what insurers could credit on fixed products. Insurers invest premiums mainly in bonds, so higher bond yields translate into higher fixed annuity rates (how annuity rates are set and why they move). LIMRA cited an interest rate environment favoring fixed-rate deferred annuities as one driver of 2025 sales.

Demographics. LIMRA describes "Peak 65," the period in which more than 4 million Americans turn 65 each year. People nearing retirement are the core annuity audience: they want income they cannot outlive and protection from a market decline right before they need the money.

Fewer pensions. Employers shifted from pensions to 401(k) plans over decades. Annuities are one way to recreate a guaranteed paycheck. (When employers go the other way and hand pension obligations to insurers, see pension risk transfer: when your pension becomes an annuity.)

Market and economic uncertainty. For the second quarter of 2026, LIMRA cited global tensions, record equity market performance and rising interest rates. Strong stock markets especially helped products that share in market gains, with RILA sales up 22% and traditional variable sales up 24% in the quarter, while fixed-rate deferred sales fell 9% and fixed indexed fell 7%.

Product design and distribution. Indexed products, which pair market-linked growth with limits on losses, made up 45% of sales in 2025 versus 24% a decade earlier, according to LIMRA. More insurers entered the RILA market, and more banks, broker-dealers and independent marketing organizations now distribute annuities. LIMRA projects RILA sales to exceed $85 billion in 2026.

Reading the product mix

Each product answers a different worry. Fixed-rate deferred annuities and MYGAs sell when buyers want a known rate for a set number of years, much like a certificate of deposit. Fixed indexed annuities sell to buyers who want some upside tied to a stock index without risking principal. RILAs offer more upside in exchange for accepting a stated amount of loss, called a buffer or floor. Variable annuities invest in funds and carry market risk directly. Income annuities convert a lump sum into payments that last a set period or for life. A shift in the mix, such as the 2026 move toward RILAs and variable annuities, usually tells you how confident buyers feel about stocks versus bonds, not whether the products are better. In a falling market the same buyers tend to move back to fixed products.

What records mean for a buyer

1. Rates are not permanent. A rate that looks like a good deal today reflects current bond yields. If rates fall, new contracts pay less, and a guarantee you locked in earlier looks better. If rates rise, the opposite happens. Do not assume a strong market is lasting.
2. High sales draw high-pressure selling. Commissions on some annuities are substantial, and the contracts can be complex. See best interest rules for annuity sales for the standards agents must meet and annuity sales abuses targeting seniors for common problems.
3. Complex products are growing fastest. RILAs and indexed annuities have crediting limits, caps, participation rates and buffers. Ask for the specifics in writing and read annuity surrender charges and free withdrawals before agreeing to lock money up for years.
4. Insurer strength matters. Many large annuity writers are now owned by or affiliated with private-equity-backed groups, and annuity growth has been a focus for those investors. Check financial strength ratings and your state guaranty association's limits with state guaranty association coverage lookup.

A quick checklist before buying in a record year

• Why this product rather than a CD, Treasury or no purchase at all?
• What is the surrender schedule and the free-withdrawal amount?
• Is the quoted rate guaranteed for the full term or only an initial rate?
• What are the total annual costs, including rider fees?
• What happens to the money at death? See what happens to an annuity when you die.
• Is the seller compensated by commission, and has the seller documented why the product serves your goals?

Key takeaways

• LIMRA reports record U.S. annuity sales of $461.3 billion in 2025 and a record first half of 2026 at $228.7 billion.
• Higher interest rates, the retirement wave of baby boomers, fewer pensions and demand for downside protection explain most of the growth.
• Indexed products (fixed indexed plus RILA) were 45% of 2025 sales; RILAs grew fastest.
• Sales records say nothing about whether a particular contract suits you. Compare costs, surrender terms, insurer strength and the seller's incentives.