SOURCE: Claritas Inc.

August 17, 2005 08:00 ET

Variable Annuity Purchase Behavior Mixed

Amidst Controversy Surrounding Sales Practices to Seniors, Market Audit Analysis Finds Both Growth and Decline Depending on the Sales Channel

SAN DIEGO, CA -- (MARKET WIRE) -- August 17, 2005 -- Despite a series of state and federal investigations in recent years into inappropriate variable annuity sales to senior citizens, the percentage of annuities purchased through brokers or other investment professionals jumped from 52 percent in 2003 to 57 percent in 2004, according to the Market Audit® -- a comprehensive survey of household financial behavior fielded by Integras, the advanced analytical services division of market research leader Claritas Inc.

However, purchases made through insurance companies declined from 30 percent to 25 percent over the same time period. No significant change was detected in annuity sales through banks (15 percent of all variable annuity sales). Data for this analysis was developed from over 175,000 interviews comparing variable annuity purchase channels.

Variable Annuity Purchase Channels:

Annuities are insurance products that provide investors with regular income payments. Unlike fixed annuities, which pay a guaranteed amount at regular intervals, the payments from a variable annuity depend on the value of the account, which can rise or fall. Typically, the money in a variable annuity is invested in a mutual fund that holds stocks or bonds.

The analysis also showed that age, wealth and small business ownership appear to be drivers of annuity channel purchase preference. For example:

--  The mean age of those purchasing through an insurance company was 59
    years old compared to those purchasing through a bank with a mean age of 65
    years old (mean age through the broker channel was 60.5 years old).
--  Annuity holders with the highest levels of Income Producing Assets
    (IPA) were the most likely to purchase through a broker and those with the
    lower average IPA levels were more likely to purchase through a bank. (IPA
    measures a household's liquid financial assets and includes products like
    checking accounts, savings accounts, certificates of deposit, IRAs, mutual
    funds, retirement accounts, stocks, bonds, securities and other liquid
    assets. IPA does not include the estimated value of a household's primary
    residence or vehicles.)
--  Those who purchase through an insurance company are also the most
    likely to own a small business -- 16.5 percent are business owners compared
    to 14.7 percent through the broker channel or 10.3 percent through the bank
About Integras

Formed in January 2003, Integras provides high-end analytical consulting and advanced decision support for marketing and location strategy. A division of Claritas Inc., Integras combines sophisticated quantitative analysis with the broadest array of consumer and business data available in the United States to help companies make better strategic decisions. In addition to conducting four syndicated surveys (Insurance Audit, Market Audit, Convergence Audit and Restaurant Audit), the Customer Research and Targeting business unit of Integras conducts custom primary market research on behalf of their clients. For more information about these and other Integras services visit

About Claritas

Since 1971, San Diego-based Claritas has been the pre-eminent source of accurate, up-to-date marketing information about people, households and businesses within any geographic area in the United States. Its target marketing services are aimed at reducing the cost of customer acquisition and growing customer value. Claritas offers industry-leading consumer segmentation systems, consulting services and software applications for site analysis, advertising sales and customer targeting. Claritas is a division of VNU, a world-leading information and media company that includes ACNielsen, Nielsen Media Research, Spectra Marketing Systems and Scarborough Research, among others. To learn more about Claritas and VNU products and services visit their web sites at and

Contact Information

  • Contact:
    Stephen F. Moore
    Claritas Inc.
    (858) 677-9634
    Email Contact