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January 08, 2006 at 02:00 PM
Year-to-date death benefits (though Sept. 30, 2005) paid out by the top 50 insurers remained on track with full-year 2004 payouts, according to data gathered from annual statement filings.
The information from the National Association of Insurance Commissioners Annual Statement Database via National Underwriter Insurance Data Services/Highline Data looks at 2005 data through the end of the third quarter and full-year 2004 and 2003 data.
Year-to-date benefits in 2005 totaled $27.4 billion for the top 50, 79% of the $34.5 billion 2004 total death benefits paid out by these companies. In 2004, death benefits paid out by the top 50 grew 2% over 2003′s $33.9 billion total.
Although fourth quarter 2005 financial statements are not yet available, at the end of the third quarter, several companies were well over 75% of their 2004 totals with a 4% increase in 2005 over 2004. However, some data suggests that people tend to live through the holidays. If it proves so in 2005, fourth quarter data could lower full-year 2005 data to a level comparable to 2004.
Scottish Re (U.S.)’s total at the end of the third quarter stood at 577% its 2004 total; RGA Reinsurance Company at 119%; John Hancock Life Insurance at 98%; Munich American Re at 91%; First Colony Life and Principal Life both at 88%; American Life at 87%; Monumental Life at 87%; and, MassMutual and Standard Insurance, both at 86%.
If the $333 million increase in Forethought Life Assurance Company’s total is removed from the 2004 death benefit total, the increase would be nearly flat at .89% for benefits paid out in 2004 compared with 2003. A Forethought spokesperson says all in-force business was moved to Forethought Life Assurance Company from Forethought Life Insurance Company and Arkansas National Life at the end of 2003.
The American Council of Life Insurers, Washington, also found that benefits paid remained constant in 2004 over 2003. In its 2005 Fact Book, it says that for all life insurers, $52 billion in benefits were paid to beneficiaries of policyholders who died, unchanged from 2003. Of the $52 billion total, according to the ACLI Fact Book, $32 billion or 62% were benefits paid from individual life insurance contracts. Group life payments represented $19 billion or 36%. Short-term individual and group credit life represented $646 million in payments.
The life insurance industry is expecting and preparing for a time when, as baby boomers age, there will be an increase in claims, says Jack Dolan, an ACLI spokesman.
