Group Life Reinsurance Ceded Seesawed In Last 5 Years
While group life insurance in-force business has grown steadily since 1999, reinsurance ceded from this business during this time has been a story of more dramatic peaks and valleys, according to data provided by National Underwriter Insurance Data Services.
For the top 25 group life insurers, group life in-force grew 8.5% in 2003 compared with 2002. In previous years, year-over-year growth was 6.8% in 2002; 11.9% in 2001; and 7.9% in 2000. (See chart on this page.)
Changes in group reinsurance ceded at year-end by the top 25 companies moved more dramatically in year-over-year comparisons than group in-force totals. (See large chart on page 17.)
In 2003, reinsurance ceded at year-end grew 12.8% over 2002. Respective year-over-year growth in previous years was 24.4% in 2002; 15.6% in 2001; and 68.2% in 2000.
While both group life in-force and reinsurance ceded each grew year over year through 2003, their growth rates did not correlate. So, for instance, the 11.9% growth rate in 2001 for the in-force total was slightly higher than the 7.9% year-over-year growth rate registered in 2000. However, looking at reinsurance ceded, the year-over-year growth rate was only 15.6% in 2001 compared with 68% in 2000.
In 2002, the year-over-year growth rate for group life in-force was 6.8%, down from the previous years 11.9% growth rate. Reinsurance ceded, however, grew 24.4%, up from a year-over-year growth rate of 15.6% in 2001.