According to figures from the National Association for Variable Annuities, VAs experienced a 6.5% rise in sales last quarter over the previous quarter, but total sales for 2002, at $113.7 billion, were barely up over total sales for 2001, at $113.0 billion.
Furthermore, net flow figures remain a tiny fraction of total sales, meaning that little new money is migrating into annuities; the industry took in only $30.7 million in assets in 2002. In 2001, $30.0 million in new assets made its way into VAs.
Total assets were down in 2002 over the previous year. At year-end 2001, VAs held $885.8 billion in assets, whereas they held $788.9 in assets at the end of 2002.
VA investors have decreased their investment in equity accounts, shifting to fixed accounts and bonds. At year-end 2001, 58.6% of money was in equity accounts, whereas only 48.4% was in equity accounts at the end of 2002. Fixed account assets during that period rose from 22.2% to 28.9% of assets, and bond fund assets rose from 7.0% to 10.3% of assets.