NU Online News Service, April 23, 2004, 12:28 p.m. EDT – Rate increases helped sellers of U.S. individual disability insurance overcome sluggish sales in 2003.[@@]
Premium revenue from new individual disability policy sales fell 1.3%, to $321 million, but revenue from in-force policies increased 4%, to $3.7 billion.
JHA Inc., Portland, Maine, has published those results in its latest individual disability market survey report.
The survey covered guaranteed-renewable policies and non-cancelable policies along with the buy-sell policies used in business transactions.
An issuer of a guaranteed-renewable policy agrees to lock in benefits but keeps the right to increase rates for specific reasons.
The issuer of a non-can policy agrees to lock in both benefits and rates.
Premium revenue for guaranteed-renewable policies increased 5.1% in 2003, to $407 million, but premium from sales of new guaranteed-renewable policies fell 2.9%, to $60.2 million.
Premium revenue for non-can policies increased 3.7%, to $3.2 billion, as premium revenue from new non-can policy sales fell 0.9%.
Although 2003 sales held steadier for non-can policies than for guaranteed-renewable policies, guaranteed-renewable sales looked healthier than they did in 2002, JHA says.
Non-can sales soared 22% in 2002, while guaranteed-renewable sales fell 11%.
The individual disability survey attracted 19 carriers. A few of those carriers generated much more growth than others, according to JHA President Drew King.
“While overall industry sales results remained relatively flat in 2003, individual company results varied greatly,” King says in a statement about the survey results.
JHA is a unit of General Re Life Corp., Stamford, Conn.