Premiums from individual life insurance sales declined 26% in the first quarter of 2009 from a year ago, according to LIMRA International.
“Historically, recessions have had little effect on individual life insurance sales,” said Robert Kerzner, president and chief executive of LIMRA, Windsor, Conn. “However, it appears the severity of this current economic downturn has impacted sales dramatically. To put it into perspective, the last time quarterly sales dropped this much was in 1943.”
All products experienced declining sales, but variable life products fared the worst. All told, variable life premiums fell 61%, according to LIMRA’s “U.S. Individual Life Insurance Sales” report.
Universal life sales were down 33% for the quarter. A year ago, UL was the only product line showing strong growth, LIMRA notes.
While whole life managed to show growth during the last three quarters of 2008, WL products also saw a drop in the first quarter, down 5% from a year ago.
Term insurance experienced the smallest decline, down only 4%.
LIMRA’s preliminary estimates show that term and WL each represented 28% of the annualized premiums issued in the U.S. in first quarter of 2009–which would be a record for term and the highest share for WL since 1999.
Overall policy count continued its downward trend in the quarter, falling 8%. All product lines experienced declines, with variable life and variable universal life dropping the most–23% and 51%, respectively.