Significant Growth of Registered Indexed-Linked Annuities in 2025
A report from AM Best highlights the significant growth of registered indexed-linked annuities (RILAs) within the U.S. life insurance sector in 2025. This product segment, which is largely contributing to the increase in variable annuity activity, saw premium stability in deferred and fixed indexed annuities during the same period. RILAs offer opportunities for greater yield with generally better caps and participation rates than fixed-indexed annuities, yet they introduce an additional market risk dimension for policyholders.
Jason Hopper, AM Best's associate director, explained that RILAs are distinct from traditional variable annuities due to their ability to provide some protection against market downturns while still linking returns to external index performance. The RILA market, historically concentrated, has expanded recently with the entry of Fidelity & Guaranty and Securian Financial. This expansion has driven substantial growth in variable annuities with guarantees in 2025. AM Best forecasts a modest expansion of the RILA market, likely limited to firms with existing experience in SEC-registered products.
Louis Silvers, a senior financial analyst at AM Best, noted that many companies have incorporated RILAs as an option within their existing variable annuity portfolios. While this report details the highest growth rates in the sector, these leading growth companies are not necessarily market dominants. In contrast, there has been a decline in fixed indexed annuity premiums among other carriers. Notably, about half of the top growth performers are insurers backed by private equity or asset managers.
Additional insights from the report reveal that all life insurance products experienced higher direct premiums written in 2025, with the most significant growth observed in indexed universal life (IUL) and, to a lesser degree, in variable universal life (VUL). The group annuity sector's premium growth was primarily driven by mutual companies, although newer, smaller firms that entered the market also facilitated increased competition and competitive pricing.
For further insights and a comprehensive understanding of the report, interested parties can access it through AM Best's website. Details concerning the credit ratings mentioned in this report are publicly available on AM Best’s Recent Rating Activity web page, along with guidelines on the use and limitations of these ratings. AM Best is a renowned credit rating agency and data analytics provider focused on the insurance industry, maintaining a presence in over 100 countries worldwide.