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LIMRA: 2002 Life Premiums Rise 3%

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NU Online News Service, March 12, 2003, 11:49 a.m. EST – Premiums from individual U.S. life insurance sales increased 3% in 2002, according to results of industry surveys by LIMRA International, Windsor, Conn.

LIMRA, a nonprofit market research consortium, declined to give a dollar figure for 2002 sales, but it says 2001 sales amounted to $11 billion.

LIMRA is also reporting a 12% increase in the face amount of the coverage sold.

Calculations based on the LIMRA figures suggest that the price for every $1,000 of coverage sold dropped about 8%.

The LIMRA survey results show that the stock market slump is continuing to push consumers toward products that offer low levels of investment risk.

Sales of universal life insurance, which pay a fixed rate of return, were about 46% higher in the fourth quarter of 2002 than they were in the fourth quarter of 2001.

UL sales accounted for 28% of 2002 sales revenue. That’s the highest share universal life has achieved since 1986, LIMRA says.

Sales of variable life insurance policies, which give purchasers the ability to put assets in accounts that resemble mutual funds, were down 24%.