Best’s Special Report: U.S. Life/Annuity Industry Posts 61% Net Income Spike in 2021

OLDWICK, N.J.--(BUSINESS WIRE)--The U.S. life/annuity (L/A) industry saw a 61% increase in net income to $36.2 billion in 2021 despite higher expenses and benefit payouts. These preliminary results are detailed in a new Best’s Special Report, titled, “First Look: 2021 Life/Annuity Financial Results,” and the data is derived from companies’ annual statutory statements received as of March 14, 2022, representing an estimated 93% of the total L/A industry’s net premiums written.

According to the report, total expenses for the industry grew 7.6%, as an additional $10.6 billion transferred to separate accounts minimized the increases in death, annuity and surrender benefits. Pretax net operating gain for the industry was $51.8 billion, up 38.2% over the prior year. A $3.3 billion increase in tax obligations and $2.7 billion reduction of net realized capital losses contributed to the higher net income result.

Capital and surplus rose 9.0% from the end of 2020 to $444.5 billion, as the net income result plus contributed capital, changes in unrealized gains and other changes in surplus were reduced by a $15.1 billion change in asset valuation reserve and $33.3 billion of stockholder dividends.

To access the full copy of this special report, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=318389.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

Copyright © 2022 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.