As carriers continue to raise variable annuity fees due to the increased cost of guaranteeing income, sales continue to weaken; in the quarter ended Dec. 31, sales dropped 3.6% to $32.6 billion, compared to $33.8 billion in the year-earlier period, according to LIMRA International. In the third quarter, VA sales fell 16%.

Mark Grier, vice chairman of Prudential, which lost $1 billion in 2008 when the S&P 500 dropped 38%, said in a recent investor call: “We’re not pricing to aggressively gain share. We’re not buying share at the expense of future profitability.”

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