On March 17, 2015, LIMRA, the research organization that reports on the life insurance industry in the United States, released its “Fourth Quarter 2015 U.S. Retail Individual Life Insurance Sales Survey.”
The survey found that for individual life insurance new annualized premium increased one (1%) percent in the fourth quarter of 2015—the sixth consecutive quarter of positive growth, according to LIMRA’s Survey results.
First year of positive policy count growth since 2012
“While growth slowed in the fourth quarter, individual life insurance premium sales increased six (6%) percent in 2015,” noted Ashley Durham, assistant research director, LIMRA Insurance Research. “Whole life and indexed universal life insurance products continued to drive overall growth throughout the year.”
Total policy count rose one (1%) percent in the fourth quarter and four (4%) percent for the year. This is the first year of positive policy count growth since 2012.
Universal life premium down for quarter but up for year
Universal life new annualized premium fell one (1%) percent in the fourth quarter, primarily because of a decline in lifetime guaranteed universal life and current assumption universal life (down ten (10% percent and fourteen (14%) percent, respectively). Despite fourth quarter declines, universal life ended the year up seven (7%) percent.
Indexed universal life premium growth slows for quarter but still drives universal life sales
Indexed universal life premium increased six (6%) percent in the fourth quarter. This is slowest quarterly growth indexed universal life has experienced since the fourth quarter 2013. In 2015, indexed universal life jumped fifteen (15%) percent and was the primary driver of overall universal life sales growth for the year. Indexed universal life represented fifty-five (55%) percent of universal life new premium and twenty-one (21%) percent of all individual life insurance new premium.
Total universal life premium represented thirty-eight (38%) percent of all life insurance new premium in 2015.
Variable universal life premium falls three (3%) percent in 2015
Variable universal life premium fell eleven (11%) percent, resulting in a three (3%) percent decline in 2015. Market share for variable universal life remained at seven (7%) percent of total life sales.
Whole life premium ends 2015 with tenth year of positive growth
Whole life premium continued to enjoy positive growth in 2015. In the fourth quarter, whole life increased six (6%) percent and improved nine (9 %) percent in 2015. This is the 10th consecutive year of positive growth for whole life.
Sixty (60%) percent of the companies showed positive growth, including 9 of the top 10 carriers. Whole life was the biggest driver of overall growth in absolute dollars for the quarter and the year.
Whole life represented thirty-four (34%) percent of the total life insurance new premium in 2015.
Term life insurance shows two (2%) percent growth for year
Term life sales growth was modest, up one (1%) percent in the quarter and two (2%) percent for the year. LIMRA is projecting little term sales growth over the next couple of years as pricing, reserving and capital issues continue to affect the market.
Term’s market share was twenty-one (21%) percent in 2015.
The following chart provided courtesy of LIMRA sums the fourth quarter and annual results:
Established in 1916, and originally known as the Life Insurance Management Research Association, LIMRA adopted the acronym for its original name as its official name in the 1990s.
LIMRA serves over 850 financial services firms in 64 countries that offer:
- Life insurance
- Retirement savings products
- Health Insurance
- Disability Insurance
- Long-term care insurance
- Mutual funds
- Other financial products
LIMRA seeks to increase its member companies’ marketing and distribution effectiveness through industry research and training involving: benchmarking and sales trends research; product research; distribution research; consumer/customer engagement research; technology research; custom research; international research; and the LIMRA secure retirement institute.