CORRECTING and REPLACING -- Beacon's Fixed Annuity Premium Study Reports Third Quarter's Fixed Annuity Sales

New York Life the New Leader in Total Sales; Preferred Fixed Annuity the New Top Product


EVANSTON, Ill., Dec. 7, 2007 (PRIME NEWSWIRE) -- The following corrects and replaces a release sent 12/07/2007 issued under the same headline; changes included the sub-headline and the second sentence of the third paragraph:

U.S. sales of fixed annuities were an estimated $17.7 billion in third quarter, 2007 according to new data from the Beacon Research Fixed Annuity Premium Study based on sales of 49 insurance companies representing an estimated 88% of the market. Overall sales were up 9.8% from the previous quarter but were 10.0% below third quarter, 2006. On a year-to-date basis, total market sales were an estimated $47.5 billion, down 12.9% from the first three quarters of 2006.

By product type, estimated sales in third quarter, 2007 were: book value(1) -- $6.6 billion; indexed -- $6.3 billion; market value-adjusted (MVA) -- $2.9 billion, and; immediate -- $1.9 billion. These estimates reflect increases in all product types except indexed annuities from the prior quarter. Relative to third quarter, 2006, sales of immediate annuities were up 14.9%. Book value products were down 18.6%, MVAs dropped 15.7%, and indexed annuities declined 3.8%.

New York Life was third quarter's big winner among Study participants. It assumed leadership in overall and bank channel product sales and retained its long-running top spot in the captive agent channel. In sales by product type, it was the dominant issuer of immediate annuities for the sixth consecutive quarter as well. The other sales leaders by product type were: Book value -- AIG Annuity Insurance Company (NYSE:AIG); Indexed -- Allianz Life Insurance Company of North America(2), and; MVA -- Hartford Life (NYSE:HIG).

New York Life also had third quarter's best-selling product -- Preferred Fixed Annuity, a book value annuity. It took the top spot from long-term sales leader MasterDex, an indexed annuity issued by Allianz Life, which moved down one place(3). But another Allianz indexed annuity -- Endurance -- joined the top five for the first time, coming in fourth. In the number three spot was Hartford's CRC, an MVA annuity(4). MultiChoice Income Plus -- an indexed annuity issued by an Aviva USA company -- came in fifth(5). Third quarter results include sales of some 225 products(6).



 Rank     Company Name       Product Name                Product Type

 1        New York Life      Preferred Fixed Annuity     Book Value
 2        Allianz            MasterDex                   Indexed
 3        Hartford Life      CRC                         MVA
 4        Allianz            Endurance                   Indexed
 5        Aviva              MultiChoice Income Plus     Indexed

Three of these top five products were also distribution channel bestsellers. New York Life's Preferred Fixed Annuity posted top bank channel sales for the first time in four quarters and retained its best-selling status among captive agents. The Allianz MasterDex led in sales by independent producers for the thirteenth quarter straight. Hartford's CRC had top wirehouse sales. GPA Plus, a book value annuity issued by John Hancock (TSX:MFC), continued as the independent broker-dealer channel's bestseller(7). Among large/regional broker-dealers, the leading fixed annuity was ProSaver(r) Platinum, an MVA issued by Protective Life (NYSE:PL) (8).



 Channel                 Company         Product           Product Type

 Banks and S&Ls          New York Life   Preferred Fixed   Book Value
                                          Annuity

 Captive Agents          New York Life   Preferred Fixed   Book Value
                                          Annuity
 Independent
  Broker-Dealers         John Hancock    GPA Plus          Book Value

 Independent Producers   Allianz         MasterDex         Indexed

 Large/Regional          Protective      ProSaver
  Broker-Dealers          Life            Platinum         MVA

 Wirehouses              Hartford Life   CRC               MVA

Continuing last quarter's trend, sales shifted toward longer rate terms in third quarter, 2007. One-year rate terms lost share in sales of both book value and MVA annuities. Book value sales shifted toward five- and six-year interest guarantee periods (IGPs). IGPs of five to ten years accounted for 81.7% of MVA sales, up from 52.5% in the prior quarter.

"Third quarter was marked by lower equity prices as well as increased stock market volatility. This motivated a shift to more conservative investments like fixed rate annuities, which offered relatively attractive rates because of the quarter's positive yield curve," said Jeremy Alexander, CEO of Beacon Research. "The yield curve was positive because, though rates declined, there was a bigger drop on the short end. This was reinforced when the Federal Reserve reversed direction and cut rates 50 basis points. If the yield curve continues to steepen, issuers of fixed annuities will be able to credit higher rates than other fixed rate alternatives."



 (1) Book value fixed annuities pay a declared rate of interest for a
 specified period. A market value adjustment (MVA) is not imposed if
 the holder withdraws assets before the end of the contract term. MVA
 products also pay a declared rate of interest for a specified period,
 and do impose such an adjustment.
 (2) Allianz Life Insurance Company of North America is a subsidiary of
 Allianz AG (NYSE:AZ).
 (3) Based on consolidated sales of MasterDex, MasterDex 5, and
 MasterDex 10 in all states including New York.
 (4) CRC is marketed in some states as CRC Select.
 (5) MultiChoice Income Plus is issued by AmerUs Life Insurance
 Company, an Aviva USA company, which recently changed its name to
 "Aviva Life and Annuity Company." Aviva USA is a subsidiary of Aviva
 plc (LSE:AV).
 (6) This total excludes immediate annuities. Beginning with second
 quarter, 2007, these annuities are analyzed at the product type level
 because many participants now issue more than one immediate annuity.
 Prior quarters' product counts included immediate annuities.
 (7) GPA Plus has been the Study's leading independent broker-dealer
 product since second quarter, 2005. Due to a distribution channel
 redefinition, John Hancock's independent broker-dealer sales include
 revenue formerly reported as captive agent channel sales.
 (8) ProSaver Platinum is also marketed as ProSaver Platinum 468 with
 different rate terms/surrender periods.

About the Beacon Research Fixed Annuity Premium Study

The quarterly Study is the first and only source to track and analyze product-level fixed annuity sales on an ongoing basis. Providing timely market intelligence of the highest quality, it's designed to report what's moving in each channel and why. The rapid growth in Study participation is testimony to the need for this information.

About Beacon Research

Beacon Research is an independent research organization founded in 1997. It compiles market intelligence on fixed annuity products for subscribers to its web-based systems at www.annuitynexus.com. Carriers access these systems to support product development, rate setting and competition research. Distributors use them for product analysis and selection. The AnnuityNexus Sales Support System is an important resource for retention teams and sales desk staff throughout the distribution chain. Beacon also licenses information and software tools to other platforms, including websites for sales representatives and Finetre's AnnuityNet annuity automation platform. Beacon's fixed annuity benchmark series -- the industry's first -- is available through Ibbotson Associates. Directly and through strategic alliances, Beacon information can be accessed by hundreds of financial institutions and distributors.

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