The voluntary worksite benefits market came out of the doldrums in 2006, with sales rising 8% over the 2005 total, to $4.7 billion, according to Eastbridge Associates Inc.
Revenue increases for voluntary benefits had averaged just 2.7% from 2002 through 2005, reports Eastbridge, Avon, Conn.
The 2006 increase was still well below the typical pre-2002 growth rate, which was consistently in the double digits, Eastbridge says.
The research firm’s survey of more than 60 voluntary benefits carriers found that sales rose an average of 10% for the top 15 companies, much improved over the 1.5% increase recorded in 2006.
“This year, among the top 15 companies, 9 had double-digit sales increases,” says Gil Lowerre, president of Eastbridge. “Just 4 had decreases, with all but 1 being in the 1% to 3% range.”
Eastbridge attributes much of the slower growth over the past few years to a few large companies. Most of these companies had good years in 2006, with 7 of the largest 9 seeing double-digit sales growth, Eastbridge says.
In-force premiums also rose by about 10% in 2006, up from 7% in 2005.
Eastbridge estimates 2006 in-force worksite premium was between $14.8 billion and $19.5 billion.