Variable life insurance sales with single premiums included at 10% for the 38 companies reporting in the VALUE survey for the 3rd quarter of 2008 were $541 million, a 13.8% decrease from 2nd quarter 2008 sales, which were $628 million, and a 24.5% decrease from 3rd quarter 2007 sales, which totaled $716 million.

Year-to-date 3rd quarter 2008 sales of $1.788 billion were 13.2% lower than the same time period in 2007, which had sales of $2.061 billion.

(Sales include first-year annualized premium, drop-in premiums and 10% of single premiums.)

The market estimate for the 3rd quarter of 2008 with single premiums included at 10% is $580 million, while for the first 9 months the market estimate is $1.92 billion.

Variable life sales with single premiums included at 100% for the companies in the VALUE survey for the 3rd quarter of 2008 were $552 million, a 13.1% decrease from 2nd quarter 2008, which had sales of $635 million, and a 24.1% decrease from 3rd quarter 2007 sales, which were $727 million.

The market estimate for the first 9 months of 2008 with single premiums included at 100% is $1.94 billion, down from $2.24 billion for the same period the year before.

For the first 9 months of 2008, the top 5 companies/fleets–John Hancock, Hartford Life, Pacific Life, AXA Financial/MONY and RiverSource–captured 56% of all variable life sales (including single premiums at 10%), while the top 10 companies/fleets garnered 79% of VL sales.

For the companies in the survey, the number of flexible-premium contracts issued during the first 9 months of 2008 decreased 26% from the number issued during the first 9 months of 2007. The average face amount increased 5% to $426,305.

The total premium for second-to-die products issued during the first 9 months of 2008 for the companies in the survey was $286 million, compared to $250 million during the first 9 months of 2007.

The number of second-to-die contracts (including single-premium and flexible-premium products) issued during the first 9 months of 2008 increased 8% over the same period the year before. The average face amount increased 10% to $2,635,163.

For the companies reporting sales by distribution channel for the first 9 months of 2008, career agents and independent broker-dealer firms dominated flexible-premium variable life sales, capturing 45% and 35% of the market, respectively.

Independent broker-dealer firms and career agents also dominated second-to-die variable life sales, capturing 46% and 36% of the market, respectively.

As of Sept. 30, 2008, total variable life assets for the companies reporting in VALUE were $107.4 billion, down 19% from $133.4 billion reported on Sept. 30, 2007. Of the total assets reported, 90% were held in a separate account.

Fixed account interest rates on VL policies decreased slightly. The average 1-year interest rate was 4.29% on Sept. 30, 2008, down from 4.36% on June 30, 2008. The average renewal rate on Sept. 30, 2008 was 4.32%, down very little from 4.33% on June 30, 2008.

Leah Wolf is with Towers Perrin, of which Tillinghast is a business. She can be reached at leah.wolf@towersperrin.com