MIB Life Activity Index Ends Year With an Increase

Details

MIB breaks life application activity volume down by three age groups. Here they are for December:

• Ages 0-44: Up 3.8%
• Ages 45-59: Up 5.6%
• Ages 60 and older: Up 0.8%

In the new application activity summary report, MIB gives more information than it usually does about the application volume for different types of life insurance policies.

MIB reported, for example, that, for consumers ages 0 to 44, life application activity increased for policies in each death benefit amount category.

For consumers ages 71 and older, application activity increased only for policies with a death benefit over $5 million.

Application activity decreased for the oldest applicants for policies in the other death benefit amount categories — $0 to $250,000; $250,001 to $1 million; and $1,000,001 to $5 million.

Most life insurers give paramedical exams to consumers who are applying for life insurance policies with $5 million death benefits. For consumers ages 71 and older, application activity for high-death-benefit policies was strong in 2020 even though the pandemic interfered with access to paramedical exams.

Some older consumers may have applied for the jumbo policies because they were afraid of COVID-19, or because the wanted to use large life insurance policies as a vehicle for paying for long-term care.

Other older consumers may have been buying large life insurance policies to prepare for the possibility that the federal estate tax could snap back to the levels that were in place before the passage of the Tax Cuts and Jobs Act of 2017.

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