Annuity Trends to Watch For in 2026: Products, tech, and market shifts

The U.S. annuity market has grown significantly, and that momentum is bound to continue into 2026. Record-breaking annuity sales over the past several years reflect a growing demand for safety and guaranteed income driven by market volatility, demographic shifts, and heightened awareness of retirement income gaps. 

“With the U.S. entering its second consecutive year of “Peak 65,” the size of the market and urgency for appropriate retirement solutions will only intensify,” said Jeff Gill, Americas Insurance Leader at EY. 

In addition, as markets hover near record highs, many consumers are seeking downside protection from equity exposure. “In 2026, we expect individuals will continue to look for ways to protect their money from market risk, while trying to grow their assets to offset longevity risk,” said Keith Namiot, Head of Annuities at Guardian.

Annuities 2026: Flexibility, access, and experience

In 2026, annuity innovation will continue to accelerate, shaped by the convergence of insurance, asset management, and wealth solutions. To succeed, providers will need to focus their efforts on smarter design, broader access, and seamless experiences. 

Here are the key products and trend categories that are likely to dominate:

Registered index-linked annuities (RILAs)

We expect the continued growth of indexed-based annuities—particularly RILAs. These products are an attractive alternative to traditional variable annuities as they offer both opportunity and adaptability to market conditions. 

According to Liza Tyler, Head of Annuities Solutions at Transamerica, the Structured Index Advantage (TSIA),Transamerica’s RILA offering has seen strong momentum since its 2022 launch, thanks to its simple, innovative design.

Triple Edge Advantage within the Structured Index Advantage product is a dual-crediting strategy that not only provides positive interest when the index return is negative within a buffer, but also delivers an Edge+ Rate when returns are zero or higher. 

“These features reflect our commitment to listening to customers and delivering solutions that balance growth potential with protection. And like others in the industry, we’re already exploring what’s next,” added Gill.

Long-term care (LTC) annuities 

With America’s aging population, the long-term care conversation has never been more critical. Asset-based LTC solutions are gaining traction, even though there are relatively few providers—creating a significant opportunity for growth.

“LTC annuities, which are typically single-premium products, appeal to higher-net-worth investors, while premium-based LTC options serve those without large lump sums. Traditional LTC insurance has faced challenges like premium increases and the ‘use it or lose it’ dilemma, which is why many clients are turning to life insurance with LTC riders,” explained Tyler.

Another advantage of LTC annuities is the ability to execute a 1035 exchange—repurposing an existing annuity for long-term care without triggering a taxable event. This flexibility allows investors to meet evolving needs while preserving tax efficiency, making LTC annuities a powerful tool for retirement planning.”

In-plan income solutions

Too often, retirement planning focuses on accumulation and overlooks the importance of guaranteed income. By integrating annuity options directly into workplace plans, providers can help employees transition from saving to spending with confidence. 

“At Transamerica, we’re leading this effort through offerings like SecurePath for Life and our collaboration with TIAA on the Nuveen Lifecycle Income Index CIT Series, as well as State Street’s Lifetime Income Builder,” said Tyler.

These solutions educate participants about decumulation strategies and provide a foundation of guaranteed income—giving retirees flexibility and stability throughout their retirement years.

Contingent deferred annuities (CDAs)

Although they haven't gained much traction in the past, CDAs with newer designs have the potential to meet evolving consumer needs in 2026. “These hybrid offerings are designed to be modular, customizable, and distributed across multiple channels,” explained Gill.

Digital transformation in the annuity industry 

Artificial intelligence  in annuities

While AI is making waves across many industries, its impact on the annuity space is still emerging. “There’s tremendous potential for AI to streamline processes like form completion, underwriting, and regulatory compliance—areas that have historically been complex and time-consuming,” said David Lau, Founder & CEO of DPL Financial Partners.

According to Gill, carriers have already adopted modern, cloud-enabled platforms and scaled enterprise data strategies. Initial AI use cases focused on operational efficiency to streamline processes, reduce costs, and enable straight-through processing. 

“AI is now powering new distribution models, removing tech and operational constraints, and delivering personalized experiences for policyholders, advisors, and associates,” explained Gill. It’s also being leveraged to identify growth opportunities, helping firms pivot quickly in a dynamic market.

AI is no longer optional, nor “Is it coming? “It is here and the engine behind modernization, personalization, and scalability. Those who invest deeply today will define the annuity market of tomorrow,” added Gill.

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Anna Baluch is a finance reporter and writer with more than a decade of experience. Contact her at [email protected]