WINDSOR, Conn., March 16, 2015 — Individual life insurance new annualized premium grew 11% in the fourth quarter 2014, resulting in a 2% increase for the year, according to LIMRA’s Retail Individual Life Insurance Survey.
Policy count for every product line improved in the fourth quarter, resulting in an increase of 2% overall for the quarter. For the year, policy count fell 2%. Policy count has declined 6 out of the last 10 years.
Universal life (UL) new annualized premium rose 18% in the fourth quarter but remained down 1% for the year. UL market share was 38% of total sales in 2014.
“Indexed universal life (IUL) continued to drive growth in the fourth quarter 2014,” said Ashley Durham, senior research analyst, LIMRA Insurance Research. “Market conditions and increased carrier and product options have led to a decade of positive growth for IUL.”
IUL premium grew 36% in the fourth quarter and 23% in 2014. IUL experienced the strongest growth in absolute dollars for both the quarter and the year. IUL now represents the majority of all UL premium at 52% and represents 20% of all individual life premium.
Despite the growth in IUL, universal life sales were dampened by the continued sales decline of lifetime guarantee universal life (LTG UL) products in 2014. LTG UL fell 6% in the quarter, and dropped 26% for the year.
For the ninth consecutive quarter, variable universal life (VUL) premium recorded positive growth. VUL new annualized premium jumped 28% in the fourth quarter, ending the year 27% higher than in 2013. In 2014, 65% of the writers — including eight of the top 10 — reported growth. VUL represents 8% of total life sales.
Whole life (WL) premium reflected positive growth in the fourth quarter, improving 5%. Marking a 3% increase in 2014, WL has experience nine consecutive years of positive growth in new annualized premium. WL represents 33% of the total life market, matching the market share it held in 1998.
Term life insurance premium grew for the first time this year in the fourth quarter, improving 1% in the quarter. In 2014, term premium fell 1% compared with 2013. Term’s market share remained steady at 21%.
About LIMRA: LIMRA, a worldwide research, learning and development organization, is the trusted source of industry knowledge, helping more than 850 insurance and financial services companies in 64 countries increase their marketing and distribution effectiveness. Visit LIMRA at www.limra.com.
- 2016 FMO Executive Outlook, Part I: The M&A climate, planning for the DOL Fiduciary Rule, other key challenges
- Prudential restructures U.S. life and annuity business in effort to expand customer value proposition
- Next wave of fee-based FIAs hit the market
- 4 Real Life Stories: Life Happens honors agents for exhibiting outstanding client service
- Optional benefits: Changing a ‘no’ to a ‘yes’
- Despite increasing risks, cyber insurance remains largely disregarded by those who need it most
- U.S. life and health direct premiums expected to decline for the first time in 4 years
- New study provides insight into benefits challenges facing HR professionals