Individual life insurance new annualized premium increased 2 percent for the first half of 2016, compared with the first six months of 2015. In the second quarter, new annualized premium was flat, according to the LIMRA U.S. Retail Individual Life Insurance Sales Survey.
“A 7 percent decline in indexed universal life (IUL) stifled overall individual life insurance sales and as a result, sales in the second quarter were level with prior year. This is just the second time IUL premium has dropped in a quarter over the last 10 years,” said Ashley Durham, associate research director, LIMRA Insurance Research. “LIMRA attributes much of the decline to the recent illustration regulation, Actuarial Guideline 49, which went into effect in September 2015.”
Total number of individual life insurance policies sold in the second quarter increased 1 percent, marking the seventh consecutive quarter of positive growth. Through the first half of 2016, total number of policies sold increased 2 percent.
Universal life (UL) new annualized premium fell 4 percent in the second quarter due to the decline in IUL sales, which account for 55 percent of total UL sales and 20 percent of all individual life premium year-to-date.
Total UL premium represented 36 percent of all life insurance sales in the first half of 2016.
Whole Life (WL) product sales continued to climb as new annualized premium increased 6 percent in the second quarter. Year-to-date WL rose 8 percent. Similar to last quarter, WL products made the largest contribution to total individual life premium growth in the second quarter. If this trend continues for the remainder of 2016, it would represent the eleventh consecutive growth year for WL.