U.S. Individual Life Sales
Up 4% In First Quarter
U.S. life insurers are reporting slow growth in individual life insurance sales revenue for the first quarter.
Survey results from LIMRA International, Windsor, Conn., show premium revenue from all new individual life sales amounted to $2.2 billion, up 4% from the total for the first quarter of 2000.
The number of policies sold fell 13%, to 1.4 million, and the face amount of the coverage sold fell 15%, to $255 billion.
LIMRA researchers say the latest figures look soft partly because early 2000 was an unusually good period for term life sales. Revenue from new individual term life sales fell 24% from the first quarter of 2000, to $325 million.
But term life accounts for only 15% of new U.S. individual life policy sales revenue, according to LIMRA.
Variable universal life, the leading product in terms of new policy sales revenue, with a 45% share, continued to do well in the first quarter. Revenue for new VUL sales increased 19%, to $975 million.
The number of VUL policies sold fell 11%, to about 140,000, but the face amount of the coverage sold fell only 2%, to $51 billion.
Holders of VUL policies can put policy assets in stock funds and other investment funds. The recent slump in stock prices may have drawn consumers money to VUL products, rather than pushing it away, according to Elaine Tumicki, an assistant vice president with LIMRA.
“People were buying low, and putting more money into a variable contract at a point when the market was low,” Tumicki says.