- Annuity Companies
Top 10 Fixed Index Annuity Companies
Fixed Index Annuities have increased in popularity over the last five years resulting in many more top-rated annuity companies entering the market. In this article, we’ll list the top ten best-fixed index annuity companies based on total sales in 2019.
So without further ado let’s get started.
The 10 Best Fixed Index Annuity Companies
Best Fixed Index Annuity Companies by the Numbers
Each year the Secure Retirement Institute publishes total U.S. Individual Fixed Annuity Sales and breaks out the results for the top 20 Annuity Companies. In addition to overall annuity sales, they also break out the results by types of annuities including fixed, indexed, and top variable annuity companies as well.
In 2019 total U.S. Individual Fixed Index Annuity Sales were $73,500,000,000 and the top 20 annuity companies accounted for $64,555,688,000 of it, or 88%.
One interesting note is that all of the top 10 indexed annuity companies in 2019 are top-rated annuity companies with at least an A AM Best Rating; except for American Equity which is rated A-. On the contrary, the majority of the best-fixed annuity companies in 2019 were lesser-rated insurers.
2019 U.S. Individual Fixed Index Annuity Sales
The table below lists the top 10 fixed index annuity companies in order by the dollar amount of individual U.S. fixed index annuity sales in thousands. So for instance, Allianz Life’s total fixed index annuity sales were $8.36 Billion in 2019.
| Rank | Company name | Indexed |
|---|---|---|
| 1 | Allianz Life | $8,358,718 |
| 2 | Athene | $6,122,393 |
| 3 | AIG Companies | $6,026,956 |
| 4 | Nationwide | $5,455,800 |
| 5 | American Equity | $4,705,319 |
| 6 | Lincoln Financial | $4,122,282 |
| 7 | Jackson | $3,738,838 |
| 8 | Global Atlantic | $3,607,134 |
| 9 | Pacific Life | $3,321,109 |
| 10 | Great American | $3,142,476 |
Source: Secure Retirement Institute* U.S. Individual Annuities Sales Survey
10 Best Fixed Index Annuity Companies
#1. Allianz Life of North America
| Allianz Life | Rating |
|---|---|
| 5701 Golden Hills Dr., Minneapolis, MN 55416 | |
| A.M. Best Rating | A+ |
| Moody's (21 rankings) | A1 (5) |
| Comdex (percentile of all rated companies) | 94 |
| Standard & Poor's (20 Possible Ratings) | AA (3) |
#1 Selling Annuity: Allianz 222
#2. Athene Annuity and Life Insurance Company
| Athene Financial Ratings | Rating |
|---|---|
| 7700 Mills Civic Parkway, West Des Moines, IA 50266 | |
| A.M. Best Rating (15 possible ratings) | A (3) |
| Fitch Ratings (21 possible) | A (6) |
| Comdex (percentile of all rating companies) | 78 |
| Standard & Poor's (20 possible ratings) | A (6) |
#1 Annuity: Performance Elite
#3. AIG Companies
| American General Life Insurance Company | Rating |
|---|---|
| A.M. Best Company (Best's Ratings, 15 Ratings) | A (3) |
| Moody's (Financial Strength, 21 Ratings) | A2 (6) |
| Standard & Poor's (Financial Strength, 20 Ratings) | A+ (5) |
| Fitch Ratings (Financial Strength, 21 Ratings) | A+ (5) |
| Weiss (Safety Rating, 16 Ratings) | B (5) |
| Comdex Ranking (Percentile in Rated Companies) | 82 |
#1 Annuity: AIG Power Protector
#4. Nationwide Life & Annuity Company
| Nationwide Life & Annuity Company | Rating |
|---|---|
| One Nationwide Plaza, Columbus, OH 43215 | |
| A.M. Best Rating (15 possible ratings) | A+ (2) |
| Moody's (21 possible ratings) | A1 (5) |
| Standard & Poor's (Financial Strength, 20 Ratings) | A+ (5) |
| Comdex (percentile of all rating companies) | 90 |
#1 Annuity: Nationwide New Heights
#5. American Equity Life Insurance Company
| American Equity | Rating |
|---|---|
| 6000 Westown Pkwy, West Des Moines, IA 50266 | |
| A.M. Best Rating (15 possible ratings) | A- (4) |
| Fitch (21 possible ratings) | A- (7) |
| Standard & Poor's (Financial Strength, 20 Ratings) | A- (7) |
| Comdex (percentile of all rating companies) | 60 |
#1 Annuity: AssetShield Annuity
#6. Lincoln Financial Group
| Lincoln Financial Group | Rating |
|---|---|
| 1300 South Clinton St., Fort Wayne, IN 46802 | |
| A.M. Best Rating (15 possible ratings) | A+ (2) |
| Moody's (21 possible ratings) | A1 (5) |
| Fitch (21 possible ratings) | A+ (5) |
| Standard & Poor's (Financial Strength, 20 Ratings) | AA- (4) |
| Comdex (percentile of all rating companies) | 90 |
#1 Annuity: Lincoln OptiBlend
#7. Jackson National Life Insurance Company
| Jackson National Life Insurance Company | Rating |
|---|---|
| 1 Corporate Way, Lansing, MI 48951 | |
| A.M. Best Rating (15 possible ratings) | A (3) |
| Moody's (21 possible ratings) | A1 (5) |
| Fitch (21 possible ratings) | A+ (5) |
| Standard & Poor's (Financial Strength, 20 Ratings) | A+ (5) |
| Comdex (percentile of all rating companies) | 84 |
#1 Annuity: Jackson National MarketProtector Annuity
#8. Global Atlantic Financial Group
| Global Atlantic Financial Group | Rating |
|---|---|
| A.M. Best Rating (15 possible ratings) | A (3) |
| Moody's (21 possible ratings) | A3 (7) |
| Fitch (21 possible ratings) | A (6) |
| Standard & Poor's (Financial Strength, 20 Ratings) | A- (7) |
| Comdex (percentile of all rating companies) | 75 |
#1 Annuity: Global Atlantic 150+SE
#9. Pacific Life Insurance Company
| Pacific Life Insurance Company | Rating |
|---|---|
| 700 Newport Center Dr, Newport Beach, CA 92660 | |
| A.M. Best Rating (15 possible ratings) | A+ (2) |
| Moody's (21 possible ratings) | A1 (5) |
| Fitch (21 possible ratings) | AA- (4) |
| Standard & Poor's (Financial Strength, 20 Ratings) | AA- (4) |
| Comdex (percentile of all rating companies) | 93 |
#1 Annuity: Pacific Index Edge
#10. Great American Life Insurance Company (GALIC)
| Great American Insurance Group | Rating |
|---|---|
| 301 E Fourth St., Cincinnati, OH 45202 | |
| A.M. Best Rating (15 possible ratings) | A (3) |
| Moody's (21 possible ratings) | A2 (6) |
| Standard & Poor's (20 possible ratings) | A+ (5) |
| Comdex (percentile of all rated companies) | 82 |
#1 Annuity: Great American Legend 7
Best Fixed Index Annuity Companies
Allianz Life, Athene, and AIG are the best-fixed index annuity companies. What I think is quite telling is each of these three has been in the top five each of the last five years, as you see in the table below.
| Annuity Company | 2020 | 2019 | 2018 | 2017 | 2016 |
|---|---|---|---|---|---|
| Allianz | 2 | 1 | 1 | 1 | 1 |
| Athene | 1 | 2 | 2 | 2 | 3 |
| AIG | 3 | 3 | 4 | 4 | 5 |
| Nationwide | 7 | 4 | 3 | 3 | 7 |
| American Equity | 9 | 5 | 6 | 6 | 2 |
While I realize making a blanket statement that the insurers with the most fixed index annuity sales are the best index annuity companies; in this case, it is my belief the numbers don’t lie. At least for the top four out of five spots.
While the best annuity for you will be determined by your individual situation and goals; generally speaking, Allianz, Athene and AIG are the best fixed index annuity companies.
Best Annuity Companies Overall in 2020
The table below lists the best annuity companies in 2020 based on total U.S. Individual Annuity Sales. Annuity Sales are listed in Billions so for example, Jackson National sold $17.92 Billion of Annuities in 2020. Total sales numbers include fixed, fixed index, income, variable, and registered index-linked annuity sales. Structured settlements and group annuity sales are not included.
| Annuity Company | 2020 Annuity Sales |
|---|---|
| Jackson National Life | $17,923,072 |
| AIG Companies | $14,516,417 |
| New York Life | $13,735,311 |
| Lincoln Financial Group | $11,565,013 |
| Equitable Financial | $10,502,550 |
| Allianz Life of North America | $9,867,018 |
| TIAA | $8,619,000 |
| Brighthouse Financial | $8,357,188 |
| Sammons Financial Companies | $8,351,043 |
| Athene Annuity & Life | $7,838,129 |
| Nationwide | $7,561,500 |
| Prudential Annuities | $7,088,001 |
| Pacific Life | $6,944,644 |
| Massachusetts Mutual Life | $6,882,729 |
| Global Atlantic Financial Group | $6,700,026 |
Top 20 Indexed Annuity Companies 2020
UPDATED 3/22/21: Athene Life and Annuity was the number one fixed index annuity company in 2020 surpassing Allianz Life; according to the Secure Retirement Institute’s 2020 U.S. Individual Fixed Index Annuity Sales Survey released March 9, 2021. The 3 top index annuity companies remained the same as in 2019; Allianz, AIG, but the order changed as Athene leap-frogged Allianz for the number one spot.
Allianz Life saw their index annuity sales decrease 40% from their 2019 numbers but still managed to hang on to the number two spot. AIG remained the 3rd best-fixed index annuity company in 2020.
The table below lists the top 20 fixed indexed annuity companies of 2020 in order (sales results are in Billions).
| Annuity Company | Indexed |
|---|---|
| Athene Annuity & Life Co. | $5,846,106 |
| Allianz Life of North America | $5,016,919 |
| AIG Companies | $4,542,675 |
| Sammons Financial Companies | $3,743,678 |
| Fidelity & Guaranty Life | $3,458,101 |
| Global Atlantic Financial Group | $3,071,197 |
| Nationwide | $2,935,700 |
| Security Benefit Life | $2,882,395 |
| Great American | $2,348,040 |
| American Equity Investment Life | $2,338,390 |
| EquiTrust Life | $1,624,196 |
| Delaware Life | $1,601,571 |
| Lincoln Financial Group | $1,449,640 |
| National Life Group | $1,309,393 |
| Protective Life | $1,279,550 |
| Bankers Life & Casualty | $1,109,115 |
| Symetra Financial | $1,091,988 |
| Pacific Life | $1,012,959 |
| Jackson National Life | $1,000,778 |
| Prudential Annuities | $837,668 |
Best Fixed Index Annuity Rates 2021
The below table lists the best-fixed index annuity rates available at My Annuity Store, Inc.’s online annuity marketplace as of March 5th, 2021. This list of best fixed index annuity rates is based on the highest S&P 500 annual point-to-point with a cap crediting strategy. There are many other indexes and crediting options available, too many to list them here in a single table. If you’d like to compare rates for other crediting methods and market indexes you can do so at our online annuity marketplace.
| Annuity Company | Fixed Index Annuity | Rating | Cap | Term |
|---|---|---|---|---|
| SILAC | Denali 14 | B+ | 6.75 | 14 yrs |
| Sentinel Security Life | Accumulation Protector Plus w/ Rider | B++ | 6.00 | 10 yrs |
| SILAC | Denali 10 | B+ | 5.50 | 10 yrs |
| Great American Life (GALIC) | American Legend 7 High Band | A+ | 5.25 | 7 yrs |
| SILAC | Denali 7 | B+ | 5.00 | 7 yrs |
| Guaranty Income Life | WealthChoice 7 | B++ | 5.00 | 7 yrs |
| Great American Life (GALIC) | American Legend 7 Low Band | A+ | 5.00 | 7 yrs |
| Fidelity & Guaranty Life | Prosperity Elite 10 Protection | A- | 5.00 | 10 yrs |
| Fidelity & Guaranty Life | Prosperity Elite 7 Enhancement | A- | 5.00 | 7 yrs |
| American National (ANICO) | Strategy Indexed Annuity PLUS 10 | A | 5.00 | 10 yrs |
| Sentinel Security Life | Accumulation Protector Plus | B++ | 4.80 | 10 yrs |
| SILAC | Teton 10 | B+ | 4.75 | 10 yrs |
| Great American Life (GALIC) | American Legend 7 Non-MVA High Band | A+ | 4.75 | 7 yrs |
| Guaranty Income Life | WealthChoice 5 | B++ | 4.50 | 5 yrs |
| American Equity | IncomeShield 7 | A- | 4.50 | 7 yrs |
| Oxford Life Insurance | Select 10 | A- | 4.50 | 10 yrs |
| Nassau Life and Annuity | Nassau Growth Annuity 10 Group B | B+ | 4.50 | 10 yrs |
| American General Life Insurance | Power 10 Protector High Band | A | 4.50 | 10 yrs |
| American General Life Insurance | Power 7 Protector High Band | A | 4.40 | 7 yrs |
| Great American Life (GALIC) | American Landmark 5 High Band | A+ | 4.30 | 5 yrs |
| American General Life Insurance | Power 5 Protector High Band | A | 4.30 | 5 yrs |
| Guggenheim Life and Annuity | Highlander 7 | B++ | 4.25 | 7 yrs |
| Guggenheim Life and Annuity | ViStar | B++ | 4.25 | 10 yrs |
| EquiTrust Life Insurance Company | Market Value Index | B++ | 4.25 | 10 yrs |
Compare current index annuity rates for April 2021 at our online index annuity store.
What is a Fixed Index Annuity?
Fixed Index Annuities Explained
A fixed index annuity is a type of fixed annuity that credits interest based on the performance of an external market index rather than guaranteeing a specified annual interest rate. An indexed annuity offers an opportunity to earn more interest when the markets perform and provides downside protection from a potential market downturn.
NOTE: You may also hear fixed index annuities referred to as:
- FIA
- Equity Indexed Annuity
- EIA
- Hybrid Annuity
- Indexed Annuity
Fixed Index Annuities have less risk than a variable annuity because you can’t lose value due to poor market performance. However, they have more risk than a fixed annuity because they come with a guaranteed interest rate; indexed annuities only guarantee the worst you can do in any given year is earn zero percent.
The below infographic illustrates where a fixed index annuity falls between a fixed annuity and variable annuity as well as other investment vehicles on the investment continuum. Indexed annuities have increased in popularity largely because they offer the most growth potential of any investment that provides principal protection.
Fixed Index Annuity vs. Variable Annuity
The line graph below compares the sales of variable annuities (VA) and fixed index annuities (FIA) in the United States from 2006 to 2020. Variable annuities are represented by the blue line while the red line represents fixed indexed annuity sales.
As you can see, variable annuities have decreased in popularity significantly while fixed index annuities are becoming increasingly popular. VA sales decreased from approximately $185 Billion in 2006 to ~$100 Billion in 2020 while FIA sales increased from ~$75 Billion to ~$120 Billion during the same timeframe.
2016 marked the first year that individual fixed index annuity sales surpassed variable annuity sales in the United States. This is due in large part to the high cost and fees associate with variable annuities vs. low or no fees of an index annuity.
Typical Variable Annuity Fees
- M&E (mortality and expense) – average around .50%
- Sub-Account Fees – average 1.00%
- Optional Rider Fees (income rider or death benefit rider) – Average 1.00% each
- No Sub-Account Fees
- No M&E Fees
- Death Benefit is Full Account Value – No Fee
- Optional Income Riders – Typically .95% to 1.25% annually
If you are considering purchasing a variable annuity you will find the U.S. Securities and Exchange Commission’s (SEC) Variable Annuities: What You Should Know investor tips.
An indexed annuity’s credited interest is calculated annually and determined by the performance of a stock market index. However, you are not directly invested in the market which means your index annuity account value won’t decrease due to a potential market downturn.
How Do Fixed Index Annuities Credit Interest?
At each annual contract anniversary, the performance of the market index you’ve selected is measured. If the index performs (increases in value) you get a percentage of the growth. The amount of the index performance your FIA is credited to is determined by the crediting method you’ve selected. There are a couple of different index annuity crediting methods but Annual Point to Point is by far the most common so for time’s sake that’s the one we’ll focus on here.
Annual Point-to-Point Index Annuity Crediting Method
Calculating index performance using the annual point-to-point method:
- The index value from the beginning of the crediting period is subtracted from the value of the index at the end of the crediting period.
- The percentage of change is calculated.
- If the value at the end of the year is higher than the beginning of the year crediting component is applied to determine your interest.
Fixed Index Annuity Example:
- 107,000(ending value) minus 100,000(beginning value) = 7,000 positive change in index value.
7,000 (index value change) divided by 100,000(beginning index value) = 7% index performance. - A crediting component, or limiting factor, is then applied to the index performance to determine your credited interest rate for the year.
3 Fixed Index Annuity Crediting Methods:
A cap, spread and participation rate are the most common crediting methods used to determine how much interest an index annuity credits.
Spread – The index performance minus the spread.
Cap – 100% of the index performance up to the cap.
Participation Rate – The index performance multiplied by the participation rate.
Assuming a 5.00% cap, 2.00% spread and a 75% participation rate let us calculate the amount of annual interest a fixed index annuity would be credited using the 7% index performance in our example above.
Cap = 5% Interest credited (100% of index performance up to the cap)
Spread = 5% Interest credited (index performance minus the spread)
Participation Rate = 5.25% Interest Credited (index performance multiplied by the participation rate)
Uncapped Indexed Annuities
Allianz, AIG, and Athene have all been innovators in the indexed annuity space and I would attribute much of their success to that fact. Specifically, they all have uncapped crediting strategies and offer proprietary volatility managed indexes. Our best stock market index option available in an index annuity guide is a helpful resource as it lists the best performing index and crediting methods by annuity company and overall, with hypothetical historical returns.
Traditionally, fixed index annuities only offered annual point to point with a cap as an interest crediting strategy. In recent years, the top annuity companies have begun to offer un-capped crediting strategies using a spread or participation rate. This has become possible because of volatility managed indexes. Unlike a static index such as the S&P 500 or the Russell 2000, the volatility managed index dynamically allocates between equities and fixed income based on volatility.
The ability to manage volatility inside of these indexes smooths out returns and lowers the costs of the options that annuity companies must purchase to back the indexed annuities they issue. A lower option cost enables them to purchase more options and in return, offer more upside to their policyholders.
Best Uncapped Index Annuities & Market Indexes
Based on historical back-testing I believe these are the best uncapped fixed index annuity options available today:
Allianz Life Index Annuities: Bloomberg Universal Dynamic Index II
AIG Index Annuities: Merrill Lynch Strategic Balanced Index
Athene Index Annuities: AiPex Dynamic Allocation Index, BNP Paribas Multi-Asset Diversified 5 Index
Frequently Asked Fixed Index Annuity Questions
You may reallocate available funds at the end of each crediting period on your contract anniversary. You have 30 days to submit a re-allocation form – if you do not, your allocations will remain the same as the previous year.
It is important to note that a fixed index annuity is an insurance contract issued by an insurance company and is not a security. As such, they will not generate equity-like returns. They are a good retirement savings vehicle that provides a safe and steady way to grow your retirement savings.
You can not lose money in an indexed annuity due to a potential market downturn. However, indexed annuities do have surrender penalties if you withdraw your money prior to the end of your contract. In addition, withdrawals prior to age 59 1/2 may be subject to a 10% IRS tax penalty.
Fixed Index Annuities do not have any fees in general; however, there are optional income riders, long term care riders, and death benefit riders that can be added to an index annuity for a fee.
Gains are limited by a crediting method or “limiting factor”, index annuity contracts can be complex, contracts vary greatly from insurance company to company, highly customizable, surrender penalties for withdrawals above the annual free withdrawal provision, pre 591/2 tax penalties, and crediting factors can change on the contract anniversary date.
An Uncapped Fixed Index Annuity refers to an indexed annuity with a crediting method that does not cap the interest your account can be credited in any given year. Instead of a cap, uncapped options use a spread or participation rate crediting method.
