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June 16, 2002 at 08:00 PM
1st Quarter Variable Life Sales Slid 23% From 4th Quarter 2001
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Variable life sales continue to slide. VL sales with single premiums included at 10% for the 53 companies reporting in Tillinghasts VALUE survey for the first quarter of 2002 were almost $1.14 billion. This is a 28% decrease from the first quarter of 2001 and a 23% decrease from the fourth quarter of 2001, which had sales of $1.48 billion.
(Sales include first-year annualized premium, drop-in premiums and single premiums.)
The market estimate for the first quarter of 2002 with single premiums included at 10% is $1.15 billion.
The decrease in variable life sales can be attributed to the volatile and depressed equity markets shifting sales to fixed products, the estate tax law changes and the lagging economy.
Variable life sales with single premiums included at 100% for the 53 companies in the VALUE survey for the first quarter of 2002 were $1.18 billion. This is almost a 29% increase from the first quarter of 2001 and almost a 24% decrease from the fourth quarter of 2001.
The market estimate for the first quarter of 2002 with single premiums included at 100% is $1.2 billion.
For 2002, the top five companies/fleets–MetLife/NEF/GenAm/COVA, Hartford Life, IDS Life, Pacific Life, and Equitable–captured 32% of all variable life sales (including single premiums at 10%), while the top 10 companies/fleets garnered 56% of all sales.
For the first quarter of 2002, Met Life reported the highest annual premiums ($54.3 million). Pacific Life had the second highest with $48.1 million in annual premium sales, although it ranked fourth based on total sales (including single premiums at 10%).
For the companies reporting in the survey, the number of flexible premium contracts issued during the first quarter of 2002 decreased 28% from the number issued during the first quarter of 2001. The average face amount increased 11% to $303,139, while the percentage of premium allocated to the general account increased to 3%.
The total premium for the 13 companies participating in VALUE with 15 single premium products for the first quarter of 2002 was $32.6 million, compared to $49.0 million for the first quarter of 2001.
