Annuity Sales Keep Setting Records. Carrier Profits Just Fell 1.3%.
Annuity Sales Keep Setting Records. Carrier Profits Just Fell 1.3%.
Annuity sales kept setting records through 2026. Industry-wide carrier profits did not follow the same trend — here's what AM Best's own numbers actually show.
Two Headlines, Two Different Stories
In the second quarter of 2026, LIMRA reported a record $121.2 billion in US annuity sales, the eleventh consecutive quarter above $100 billion, with both registered index-linked annuities and single premium immediate annuities setting their own individual sales records (LIMRA, 2026). Three months later, AM Best reported something very different: US life and annuity industry net income fell 1.3% in the first half of 2026, to $19.1 billion (AM Best, September 2026).
Both numbers are accurate. They are not measuring the same thing. Sales volume tells you how much money consumers put into annuity contracts during a given stretch of time. Net income tells you how much carriers, across the entire industry, kept after paying claims, covering expenses, adjusting reserves, and paying taxes on everything they had on the books, old business and new business combined. A product category can keep growing while a specific group of carriers reports a weaker bottom line in that same window.
The rest of this post works through AM Best's own report: what moved, by how much, and which two carriers account for most of the headline decline.
What AM Best's H1 2026 Report Actually Found
Figures cover six-month 2026 interim statutory statements, not a projection or a partial sample.
AM Best's "First Look: Six-Month 2026 US Life/Annuity Financial Results" is built from six-month 2026 interim statutory statements received as of September 2, 2026, representing an estimated 97% of total industry premiums and annuity considerations (AM Best, September 2026). That is a near-complete picture of the industry's filings, not a partial or projected sample.
The report measures net income: what is left over after claims, expenses, reserve adjustments, and taxes are subtracted from everything the industry brought in during the period. That is a different number from premium volume or sales volume, and in H1 2026 it moved in a different direction than the sales headlines.
| Net income | $19.1B (-1.3%) |
| Total industry income | -8.1% |
| Pretax net operating gain | $23.3B (-10.3%) |
| Premiums/annuity considerations | -$39.4B |
| Total expenses | -8% |
| Taxes | -2.9% |
| Realized capital losses | -83.1% |
Why Net Income Fell: Two Carriers, Not a Trend
Where the $39.4 Billion Premium Decline Came From
AM Best's report is specific about where the premium decline originated: "premiums and annuity considerations fell $39.4 billion, predominantly due to a $24.1 billion reduction at Voya Retirement Insurance & Annuity Co." (AM Best, September 2026).
Worked example: Of the $39.4B total industry-wide premium/annuity-consideration decline, $24.1B, about 61%, came from one carrier: Voya Retirement Insurance & Annuity Co.
The remaining $15.3B is spread across the rest of the industry, which still wrote substantial premium in aggregate even after that one company's shift.
Where the $31.1 Billion "Other Income" Decline Came From
A separate decline, in "other income," was driven by a $21.5 billion reduction of reserve adjustments on reinsurance ceded at American United Life Insurance Co. (AM Best, September 2026), out of a total $31.1 billion decline in that income category. Reserve adjustments on reinsurance ceded are accounting entries tied to how a carrier manages risk it has passed to another insurer. They are not a signal that a carrier failed to collect premium or pay claims.
Worked example: $21.5B of the $31.1B "other income" decline, about 69%, traces to one carrier's reinsurance reserve adjustment. The remaining industry-wide movement in that category is comparatively small.
Why That Matters for the Headline Number
Combined, these two carrier-specific items, Voya's premium reduction and American United Life's reserve adjustment, explain the majority of the industry-wide decline AM Best reported. That is a materially different story than "the annuity industry had a weak first half." It is closer to "two specific companies had unusual line items that showed up once every carrier's statutory filing was added together." Industry-wide aggregates can obscure which carriers actually drove a number. This is a case where the underlying filings name them directly.
What This Means If You're Shopping for an Annuity Right Now
A sales record tells you the annuity category is popular. It does not tell you anything about the financial strength of the specific carrier behind a specific contract. Your protection as a buyer comes from that one carrier's claims-paying ability, not from how much the industry sold last quarter or what the aggregate net income figure did. This is why due diligence on an annuity happens at the carrier level, never at the industry level.
How to Check a Carrier's Financial Strength Before You Buy
Three checks that happen at the carrier level, where your actual protection comes from.
- AM Best ratings run from A++ (superior) down to D (poor) — ask what letter grade your specific carrier currently holds.
- A+ and above is generally considered a strong financial-strength signal; ratings below A carry more risk.
- Check more than one rating agency (AM Best, S&P, Moody's, Fitch) if more than one is available.
- Ask your advisor for the carrier's current rating in writing, not from memory.
- Ask when the rating was last updated — ratings change, sometimes annually.
- Ask whether the rating applies to the specific subsidiary issuing your contract, not just the parent company name on the brochure.
- State guaranty associations provide a secondary backstop if a carrier becomes insolvent, with coverage limits that vary by state (availability and terms vary by state).
- A guaranty association is a last-resort safety net, not a substitute for choosing a financially strong carrier up front.
- Your advisor can tell you your state's specific coverage limit for annuity contracts.
Common Questions
1Did annuity sales actually decline in 2026?▾
2Does a carrier-wide profit dip mean my annuity contract is at risk?▾
3What is AM Best and why does its rating matter?▾
4What's the difference between "net income" and "sales volume" for an insurance company?▾
5How do I find out my carrier's financial strength rating?▾
6Does a state guaranty association protect me if a carrier has a bad year?▾
Sources
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Compare Annuity Rates →This content is for educational purposes only and does not constitute financial, investment, tax, or legal advice. Annuity products vary by carrier and state. Consult a licensed financial professional before making any financial decisions. AnnuitiesHQ.com does not sell annuities or provide investment advice.