TY  - JOUR
AU  - Poterba,James M.
TI  - The History of Annuities in the United States
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 6001
PY  - 1997
Y2  - April 1997
UR  - http://www.nber.org/papers/w6001
L1  - http://www.nber.org/papers/w6001.pdf
N1  - Author contact info:
James M. Poterba
Department of Economics
MIT, E52-350
50 Memorial Drive
Cambridge, MA  02142-1347
Tel: 617/253-6673
Fax: 617/258-7804
E-Mail: poterba@nber.org
M2  - featured in NBER digest on 1997-10-01
AB  - This paper summarizes the development of private annuity markets in the United States.  Annuities constituted a small share of the U.S. insurance market until the 1930s, when two developments contributed to their growth.  First, concerns about the stability of the financial system drove investors to products offered by insurance companies, which were perceived to be stable institutions.  Flexible payment deferred annuities, which permit investors to save and accumulate assets as well as draw down principal, grew rapidly in this period.  Second, the group annuity market for corporate pension plans began to develop in the 1930s. The group annuity market grew more rapidly than the individual annuity market for several decades after World War II.  The most recent development in the annuity marketplace has been the rapid expansion of variable annuities.  These annuity products combine the investment features of mutual funds with the tax deferral available for life insurance products.  Variable annuity premium payments increased by a factor of five in the most recent five years for which data are available.
ER  -