Annuity sales hit another record in the second quarter, topping $116 billion, according to LIMRA. It marks the seventh straight quarter that total annuity sales have exceeded $100 billion—a streak that speaks to sustained advisor and client demand for income certainty amid ongoing market and economic volatility.
While interest rate stabilization could dampen momentum in the second half, LIMRA still anticipates solid activity through year-end.
“We’re seeing signs of a modest slowdown, which could result in lower volumes in the back half of the year,” says Bryan Hodgens, senior vice president and head of LIMRA research. “But even with some deceleration, 2025 is shaping up to be another record-breaking year. Total annuity sales are still likely to top $400 billion.”
Fixed-rate deferred (FRD) annuities continue to dominate, with $44.2 billion in second-quarter sales—up 9% year-over-year. These products, which offer a set rate for a guaranteed period and then transition to a new fixed rate or floor-bound reset, have become a go-to for conservative investors seeking short-term certainty. Once in the payout phase, the contracts provide regular income either for a specified term or for life.
But advisors may want to set expectations with clients around softening demand for FRDs, driven by stabilizing rates and a strong equity market backdrop.
“While FRD sales picked up after a weak first quarter, the momentum appears to be fading as investors who wanted to lock in rates have already done so,” says Keith Golembiewski, assistant vice president and director of annuity research at LIMRA.
Still, FRDs have remained competitive when compared to bank CDs, offering higher yields and the benefit of tax deferral—factors that continue to resonate with yield-focused clients.
Meanwhile, Registered Index-Linked Annuities (RILAs) are gaining even more traction, particularly with broker-dealer platforms expanding access. RILA sales reached $19.6 billion in Q2, up 20% from the prior year, setting a new quarterly record. First-half sales in 2025 are also up 20% year-over-year.
“RILAs offer a compelling middle ground—upside participation with defined downside buffers,” says Golembiewski. “We expect continued growth, particularly as more firms integrate these strategies into their annuity lineup.”
Fixed Index Annuities (FIAs), which similarly link returns to market indexes but provide full principal protection, generated $31.4 billion in Q2 sales—flat versus last year. Some advisors may be pivoting toward FRDs in the current rate environment, but the long-term value proposition of FIAs remains intact.
“There’s been some cannibalization from FRD annuities,” Golembiewski notes. “But FIAs still stand out for clients prioritizing protected growth and guaranteed income.”
RIAs and wealth managers increasingly recognize the role annuities can play in generating sustainable income, and client sentiment continues to evolve. LIMRA attributes the ongoing sales strength to industry-wide efforts to educate both advisors and clients on the benefits of guaranteed lifetime income within retirement plans.
“This sustained $100 billion-plus quarterly run is a testament to how far annuities have come in the planning conversation,” says Hodgens. “The shift reflects growing advisor acceptance and stronger alignment with client goals.”
But Hodgens cautions that there’s more work to be done: “Only one in five preretirees owns an annuity today, and nearly half of those approaching retirement say they don’t expect to have enough guaranteed income to cover basic expenses.”
For RIAs, the current market presents an opportunity to revisit annuity strategies—particularly for clients who are risk-averse, nearing retirement, or concerned about longevity risk. Product innovation, more transparent fee structures, and greater access through advisor platforms have made annuities more adaptable than ever. The key is helping clients understand how these tools can complement their broader financial plans—especially as rate conditions and market trends shift.
