Sales of U.S. individual variable universal life (VUL) policies continued to shine in the third quarter.
Life insurers managed to increase the number of VUL policies they sold during the quarter, not just the annualized premium total, according to new data from LIMRA.
Analysts at LIMRA — a nonprofit market research consortium — report that:
- The number of VUL policies sold was 9% higher than in the third quarter of 2017.
- The total amount of death benefits available from the new VUL policies was up 26%, year-over-year.
- The total amount of annualized premiums associated with the new VUL policies was up 29%, year-over year.
Holders of VUL policies have control over their premium payment schedules, and they can allocate policy value to funds linked to the performance of investment funds. VUL sales may have benefited from the strong performance of the stock market in 2017 and in the first half of this year.
The Rest of the Individual Life Market
VUL policies accounted for just 7% of the new life policy premiums LIMRA tracked in the third quarter.
The total number of new U.S. individual life policies sold during the latest quarter was about the same as in the year-earlier quarter, and annualized premiums from those policies increased only about 3%, according to LIMRA.
Annualized premium revenue from new policy sales increased 3% for whole life, 1% for term life and 1% for traditional universal life.
LIMRA bases the quarterly life sales statistics by conducting a survey of life insurance issuers. The organization estimates that the survey participants account for about 80% of annualized premiums from sales of new U.S. individual life policies.
LIMRA does not include dollar values in the summary reports available to the public. The organization makes the dollar values available to paying clients.
Analysts at Wink Inc., a private research firm, have reported, based on results from Wink’s own issuer survey, that issuers of whole life and universal life generated about $1.9 billion in new policy sales in the third quarter.
Wink does not currently report term life or VUL sales data.
ThinkAdvisor extrapolations based on the LIMRA market share data and the Wink sales data suggest that life insurers generated roughly $2.5 billion in annualized premiums from sales of new individual term life, whole life, VUL and non-variable universal life policies in the third quarter.
Here’s what Wink says about sales of the products it tracks, when compared with the figures for the third quarter of 2017:
- Indexed Universal Life: $529 million, up 10.5%.
- Traditional Universal Life: $325 million, down 39%.
- Whole Life: $1.1 billion, up 6.7%.
Links to the new LIMRA life insurance sales report and other life and annuity sales data reports are available here.
Links to Wink sales data articles and blog articles are available here.
— Read Analyst Who Nailed 2018 Has Same S&P 500 Forecast for Next Year, on ThinkAdvisor.