Total US single-premium pension risk transfer (PRT) premium was $14.2bn in the third quarter, up 36% from prior year’s results, according to LIMRA’s U.S. Group Annuity Risk Transfer Sales Survey.
Year-to-date, total single-premium PRT premium increased 21% to $39.9bn.
“While new premium growth rebounded in the third quarter, the growth can be attributed to larger deal activity,” said Keith Golembiewski, assistant vice president, head of LIMRA Annuity Research.
“The bigger story continues to be the expansion of the PRT market. Carriers reported the largest number of contracts ever sold in the first nine months of the year. Higher interest rates are driving companies to de-risk their pension liabilities to annuity providers. LIMRA expects this trend to continue through the rest of the year.”
Single-premium buy-out premium totalled $13.1bn in the third quarter, up 62% from prior year’s results. There were 203 contracts finalised in the third quarter, level with prior year. YTD buy-out premium jumped 26% to $36.5bn. Through September 2024, there were 530 buy-out contracts, 10% growth over prior year. This marks a record number of buy-out contracts sold.
In the third quarter, single-premium buy-in premium was $1.02bn, falling 56% from third quarter 2023. Four contracts were sold in the third quarter, matching the results in third quarter 2023. YTD, buy-in premium totalled $3.3bn, down 15% year over year. Through the first three quarters of 2024, there were nine buy-in contracts sold, one more sold than prior year (representing a 13% increase).
Single premium buy-out assets reached $288.8bn through the third quarter, up 13% from the prior year. Single premium buy-in assets were $9.1bn YTD, 11% higher than the same period in 2023. Combined, single premium assets were $298bn, an increase of 15% year over year.