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Life premiums fall 2% in 3Q as whole life sales drop for first time in 14 quarters

Insurance Forums Staff

After 13 quarters of consecutive growth, whole life (WL) insurance new annualized premium fell 4% in the third quarter of 2017, according to the LIMRA U.S. Retail Individual Life Insurance Sales Survey released Dec. 4.

This decline, coupled with another double-digit decline in lifetime guarantee universal life sales, drove total new annualized premium down 2% in the third quarter.

In the first three quarters of 2017, total life insurance new annualized premium remained positive, up 2% compared to prior year. Total policy count fell 3% for the quarter and year-to-date.

“Over the past several years, whole life has been a major driver of overall growth in the U.S. market,” said Ashley Durham, associate research director, LIMRA Insurance research. “However, in addition to a significant carrier exiting the market, 64% of whole life manufacturers – including 6 of the top 10 – reported declines in the third quarter.”

For the first nine months of 2017, whole life new annualized premium increased 2%, compared to prior year. Whole life represented 36% of the total life insurance premium year to date.

Universal life new annualized premium was flat in the third quarter, resulting in a 3% increase year-to-date.

Indexed universal life (IUL) new annualized premium rose 8%, with half of the manufacturers reporting positive growth. In the first three quarters of 2017, IUL increased 7%. Year-to-date, IUL premium represents 58% of the total UL premium and 22% of all individual life premium.

LTGUL new annualized premium fell 16% in the third quarter and fell 5% year-to-date. LTGUL premium represents 20% of UL sales and 7% of total life premium in the first three quarters of 2017.

In the first nine months, total UL premium held 37% market share.

Variable universal life (VUL) reversed course from the strong showing in the second quarter. In the third quarter, VUL new annualized premium fell 9%. Over half of the VUL writers reported declines in the third quarter. As a result, VUL is down 2% year-to-date. VUL market share is 5% of total premium year-to-date.

Term new annualized premium improved 1% for the quarter, and 2% year-to-date. Just under half of all term manufacturers reported growth in the third quarter.

Term’s market share currently stands at 22%. It has been in the 21-22% range since 2011.

LIMRA’s Third Quarter 2017 U.S. Individual Life Insurance Sales Survey represents approximately 80% of the U.S. individual life insurance annualized premium market.

View the latest data table on U.S. life insurance sales trends. For more statistics, visit the newly updated Data Bank.



6 thoughts on “Life premiums fall 2% in 3Q as whole life sales drop for first time in 14 quarters”

  1. I think its totally related to stock market. We are on a huge bull run.
    Regardless… a properly designed and funded permanent policy ain't no slouch when it comes to long term returns. Its just that 5% looks crappy when the market is kicking butt.

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