U.S. Annuity Market Growth: Record Sales of $461.3 Billion in 2025

According to data from LIMRA, the U.S. individual annuity market experienced significant growth in 2025, achieving a record sales volume of $461.3 billion, marking a 6% increase compared to the previous year. This surge is reflected in the fourth-quarter sales, which climbed 12% to reach $114.4 billion, becoming the ninth consecutive quarter to exceed the $100 billion benchmark. The findings include inputs from insurers representing 92% of the market.

Strong Performance in RILAs and FIAs

Registered index-linked annuities (RILAs) distinguished themselves in this market with a remarkable 20% growth from the previous year, totaling $79.6 billion in sales. This continued expansion marks the eleventh consecutive year of growth for RILAs. Fixed indexed annuities (FIAs) similarly contributed to the industry's upward trend, realizing sales of $128.2 billion, a 1% rise year-on-year, with fourth-quarter sales seeing an 8% increase to $34.4 billion. Collectively, FIAs and RILAs now constitute 45% of total annuity sales, compared to 24% a decade earlier.

Shift in Preferences and Regulatory Compliance Insights

Fixed-rate deferred annuities (FRDs) showed $160.6 billion in annual sales, a 5% annual increase, despite a 24% drop in fourth-quarter sales from the third quarter to $32.8 billion. This quarterly downturn belies a 12% year-over-year growth for the quarter. LIMRA attributes the previous quarter's record sales to investors securing advantageous rates amidst anticipated interest rate cuts. Furthermore, single premium immediate annuities grew 3% annually to $14 billion, while deferred income annuities faced a 3% decline, despite a 20% rise in fourth-quarter sales to $1.4 billion.

Future Outlook and Underwriting Impacts

Looking forward, LIMRA forecasts sustained growth in RILA and FIA sales through 2028, boosting their market share further. Specifically, RILA sales are projected to surpass $85 billion this year. However, a downturn in FRD sales is anticipated below 2025 levels, attributed to diminishing demand for short-duration products as interest rates decline. Keith Golembiewski, assistant vice president and head of LIMRA Annuity Research, notes that recent spikes in FRD sales were largely driven by investor actions ahead of the expected rate cuts.