Variable life insurance sales with single premiums included at 10% for the 35 companies reporting in the VALUE survey for the second quarter of 2009 were $307.3 million, a 4.5% increase from first quarter 2009 sales, which were $294 million, and a 50.9% decrease from second quarter 2008 sales, which totaled $626 million.
(Sales include first-year annualized premium, drop-in premiums and 10% of single premiums.)
The market estimate for the first 6 months of 2009 with single premiums included at 10% is $645 million.
Variable life sales with single premiums included at 100% for the companies in the VALUE survey for the second quarter of 2009 were $309 million, a 4.1% increase over first quarter 2009, which had sales of $297 million, and a 51.2% decrease from second quarter 2008 sales, which were $633 million.
The market estimate for the first 6 months of 2009 with single premiums included at 100% is $655 million, down from $1.35 billion for the same period the year before.
For the first quarter of 2009, the top five companies/fleets–John Hancock, Pacific Life, AXA Financial/MONY, Hartford Life and Lincoln National–captured 59% of all variable life sales (including single premiums at 10%), while the top 10 companies/fleets garnered 82% of VL sales.
For the companies in the survey, the number of flexible-premium contracts issued during the first 6 months of 2009 decreased 57% from the number issued during the first 6 months of 2008. The average face amount increased 7% to $405,631.
The total premium for second-to-die products issued during the first 6 months of 2009 for the companies in the survey was $78 million, compared to $195 million during the first half of 2008.
The number of second-to-die contracts (including single-premium and flexible-premium products) issued during the first 6 months of 2009 decreased 42% from the same period the year before. The average face amount increased 21% to $2,976,290.
For the companies reporting sales by distribution channel for the first 6 months of 2009, career agents and independent broker-dealer firms dominated flexible-premium variable life sales, capturing 47% and 42% of the market, respectively.
Independent broker-dealer firms continued to dominate second-to-die variable life sales, capturing 67% of the market.
As of June 30, 2009, total variable life assets for the companies reporting in VALUE were $94.73 billion, down 20% from $118 billion reported on June 30, 2008. Of the total assets reported, 88% were held in a separate account.
Fixed account interest rates on VL policies are virtually unchanged from first quarter 2009. The average one-year interest rate was 4.30% on June 30, 2009, up slightly from 4.29% on March 31, 2009. The average renewal rate on June 30, 2009 was 4.33%, up from 4.32% on March 31, 2009.
Leah Wolf is with Towers Perrin, of which Tillinghast is a business. She can be reached at firstname.lastname@example.org
Variable Life Survey — Second Quarter 2009