|By Fran Lysiak|
|A.M. Best Company, Inc.|
Total third-quarter 2011 sales of individual life insurance in
Premium for whole life jumped 10% in the quarter and year-to-date "It’s the only product to produce positive growth in each of the past five years, and, so far in 2011, nearly three-quarters of the writers were able to grow their sales; more than half managed double-digit increases," said
Mutual companies, which represent a quarter of the companies that sell whole life, reported more than half the new premium but stock companies boosted sales by 11%, LIMRA said.
In the second quarter, universal life sales rose just 1% and part of the slowdown reflected a few companies moving away from universal life policies with a lifetime death benefit guarantee, due in part to "the meager investment environment" over the past two years and companies reassessing their risks on their product portfolio, Durham said (Best's News Service,
In the third quarter, UL premium improved 3% and was up 6% year-to-date, driven by sales of indexed UL, which influenced overall sales of this product, LIMRA said. Premium for indexed UL rose 30% and 35%, respectively, for the quarter and year-to-date. Five years ago, indexed UL represented 7% of total UL sales but today comprises more than 20% of the UL market.
However, lifetime guarantee UL premium was relatively flat in the third quarter and the first nine months of this year, Durham said in an email.
Earlier this month, the
The second quarter represented the sixth straight quarterly decline for new annualized premium for term life (Best's News Service,
However, if the newer, hybrid term-UL products were included with term instead of UL, term premium would be down 1% in the third quarter, it said. Companies selling term-UL include
Term-UL is filed as a UL product but doesn't have the same reserve requirements as term life does. For a policyholder, it's affordable like level term but the policy automatically converts into a permanent policy years down the road at the end of the level-premium period (Best's News Service,
|Copyright:||(c) 2011 A.M. Best Company, Inc.|