NU Online News Service, April 22, 2004, 7:18 p.m. EDT – The weak job market and skyrocketing health insurance rates are starting to hurt employee benefits sales.[@@]
Companies in the benefits markets have reported remarkably stable sales over the past few years, but StanCorp Financial Group Inc., Portland, Ore., the parent of Standard Insurance, says current economic conditions cut its new benefits sales to $32.7 million in the first quarter, from $46.9 million in the first quarter of 2003.
The company is reporting a total of $43.6 million in net income for the quarter on $524.5 million in revenue, up from $32.2 million in net income on $508.7 million in revenue for the comparable quarter in 2003.
Although new benefits sales were down, claims experience at the benefits unit and the individual disability unit was favorable, StanCorp says.
Because claims were unusually low, pretax operating income increased to $50.1 million, from $44.6 million, at the benefits unit, and to $11.2 million, from $8.4 million, at the individual insurance unit.