Courtesy
of LIMRA March 10, 2020
Total
U.S. individual life insurance new annualized premium jumped 15% in the fourth
quarter, compared with prior year results, according to the LIMRA U.S. Retail
Individual Life Insurance Sales Survey.
For the
year, total individual life insurance new annualized premium increased 5%,
compared with 2018 results. The number of policies sold fell 2% in the fourth
quarter and dropped 3% for the year.
“Because
all life insurance products were required to shift to the 2017 Commissioners
Standard Ordinary (CSO) mortality table by December 31, many companies reported
increased sales of products using the 2001 standard,” noted Ashley Durham,
associate research director, LIMRA Insurance Research. “All major product lines
recorded growth in the fourth quarter with more than half of U.S. life
insurance manufacturers, including nine of the top 10, reporting positive
results.”
The CSO
mortality tables are a standard for measuring average life expectancy across
various demographics for the purpose of calculating life insurance reserves.
Advancements in medicine, technology, lifestyle trends and more are continually
impacting mortality rates, making periodic updates to the CSO table essential.
UL
Premium Up
Overall
total universal life (UL) new premium increased 31% in the fourth quarter,
primarily driven by indexed universal life (IUL) sales. Seven of the top 10 UL
writers reported positive growth in the fourth quarter. For the year, UL new
premium increased 9%.
For the
13th consecutive quarter, indexed universal life new premium had positive
growth, increasing 33% in the fourth quarter and 14% for the year. Eight of the
top 10 IUL writers reported positive growth. Once again, IUL products
experienced the largest absolute dollar increase for the quarter and for the
year.
Lifetime
Guarantee Universal Life new premium improved for the first time after 10
quarters of declines. LTG UL new annualized premium jumped by more than 20% in
the fourth quarter, ending the year down 5%. Seven of the top 10 writers
reported growth in the fourth quarter.
Total
UL held a 38% market share of the total life insurance market in 2019.
VUL new
premium increased 18% in the fourth quarter, year-over-year. This is the 9th
consecutive quarter of increases, compared to prior year results. Nine of the
top 10 VUL writers reported increases in new premium in the fourth quarter.
For the
year, VUL grew 11%, compared with prior year results. VUL represented 8% of the
total life insurance market in 2019.
Whole
life new premium increased 3% in the fourth quarter. In 2019, whole life new
premium growth increased 1%. Just three of the top 10 whole life writers
reported increases in the fourth quarter. Whole life new premium represented
33% of the total life market.
Term
new premium increased 4% in the fourth quarter, resulting in a 3% increase for
the year. Just over half of the term carriers reported increases in premium
(compared with fourth quarter 2018) including the majority of the top 10. Term
new premium represented 21% of the U.S. life insurance market in 2019.
LIMRA’s
Fourth Quarter 2019 U.S. Individual Life Insurance Sales Survey represents
approximately 80% of the U.S. individual life insurance annualized premium
market.
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