Legal & General Retail has reported its annuity sales have reached an all-time high of £2bn so far this year amid industry figures revealing annuity sales jumped 50% year on year in the first half.

L&G says its figures reflect a “resurgence” of annuity sales driven by higher rates and the security of annuity income.

The Association of British Insurers reported a 50 per cent rise in sales in the first half of 2024, compared to the same period the year before.

L&G said its sales are currently up 55% compared to the same week in 2023.

Apart from improved rates on annuities, L&G says there has also been increasing awareness of the other benefits of a guaranteed income.

A recent study from Legal & General and the Happiness Research Institute, an independent Danish think tank, looked at the link between annuities and happiness. The study found that retirees with an annuity score more positively across multiple wellbeing measures than those who do not.

Annuity-holders are more likely to report the highest level of financial confidence compared to those without one (24% versus 21%), according to the report.

Lorna Shah, managing director, retail retirement, Legal & General, said: “Improved rates, which mean people can get more for their money, have played a key role in driving interest, but this isn’t the only factor. 

"Together with the Happiness Research Institute we’ve shown how the certainty of an annuity enables a happier retirement, removing the fear of outliving savings and providing retirees with a sense of financial security that eases stress and uncertainty. 

“The good news is that retirees have options. It’s not an either-or-decision. Combining the guaranteed income of an annuity with other sources, such as income from investments or drawdown, can provide even more flexibility, ensuring that essential expenses are covered, while offering the opportunity to grow other assets.”