LIMRA CEO: Interest rates an iceburg in a sea of soaring sales?

The story of life insurance and annuities in 2025 begins in a great place: a sales spike unlike anything seen before.

It made LIMRA CEO Dave Levenson’s task much easier when he addressed the room earlier this week at the Life Insurance and Annuity Conference in New Orleans.

Annualized life insurance premium increased 3% in 2024 to $15.9 billion, according to LIMRA’s retail life insurance sales survey results, setting a record for the fourth consecutive year. In 2024, policy count was level with 2023 results.

LIMRA also reported record-high indexed universal life sales of $3.8 billion in new annualized premium and variable universal life new annualized premium rising 15% to $2.2 billion.

Levenson cites 'record level of demand

“The standout there is the demand for life insurance is measured by our barometer report that we do every year in partnership with Life Happens,” Levenson said, “and that showed us at a record level of consumer demand.”

On the annuity side, quarterly annuity sales surpassed $100 billion in all four quarters of the year for the first time. Total annuity sales finished at $434.1 billion, up 13% yearly, according to LIMRA’s U.S. Individual Annuity Sales Survey.

The steady rise of interest rates – topping out at 5.5% for much of 2024 – greatly aided annuity sales, Levenson noted. The Federal Reserve brought rates down to 4.5% by the end of 2024, where rates remain.

“Products like fixed annuities continue to do well, but that's now carrying over to the equity part, where fixed indexed annuities and registered index-linked annuities both saw record years,” Levenson said. “So, that's been very good for the industry.”

Not lacking challenges

An environment of great sales does not equate to an industry lacking challenges. Start with the supply of producers, a group that continues to gray, LIMRA is finding.

“We're not seeing the influx of the college graduates coming into the industry,” Levenson said. “So, there's kind of a net flat, which slowly feels like it's going to migrate to a net down in terms of the number of producers that are able to meet the consumer demand.”

The industry needs a comprehensive approach to reversing the sliding average age of insurance producers, he explained. That means college recruiting, marketing the industry and emphasizing the positives, Levenson said, including the prospects for strong earnings.

“This is a very attractive profession for young individuals coming out of college,” he said. “When you look at it from serving the needs of the consumer, a record level of demand, an attractive profession, from a growth perspective, from a compensation perspective, it's got a lot of ingredients to be a great profession for a lot of people.”

Interest rates remain another challenge, Levenson said. President Donald Trump continues to press the Federal Reserve on Monday to act on interest rates after the U.S. central bank last month kept them unchanged.

"I'd like to see the Fed lower interest rates," Trump said during a March 24 meeting with his cabinet at the White House.

That might help the economy, but it wouldn’t be ideal for annuity sellers. But regardless of what happens with rates, the LIMRA CEO sees strong sales continuing for the near term.

“I think the biggest challenge will be what happens if rates actually do come down,” Levenson said. “But I think between retail annuities and the significant success that we've seen with in-plan annuities, the broader industry, I think, just has a lot of a lot of tailwind.”

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