Allianz Life’s fixed annuity premiums dropped 16% to $4.2 billion in the third quarter compared to last year. Most of Allianz’s fixed annuity business is fixed-index annuities that are tied to an external index like the Standard & Poor’s 500.
According to Marc Olson, Allianz Life’s Vice President of Finance, Allianz has been repricing products and designing new ones that are more attractive in a low interest rate environment. They are also opening new channels for distributing its fixed annuities, like selling them through banks and broker-dealers.
Olson said he expects the annuity declines to start stabilizing in the current quarter and resume growth, on a quarter-to-quarter sequential basis, early next year. “We’re well-positioned to weather the storm,” Olson said. “While sales have been declining, I think we’re taking the right steps to stabilize and improve sales.”