What You Need to Know
- Many whole life buyers wanted cash to pay for funerals, burials and other final expenses.
- The majority of indexed product purchasers were looking for cash accumulation.
- Permanent life products have been popular with consumers looking for ways to pay long-term care bills and other post-retirement expenses.
U.S. life insurers are reporting big increases in sales of non-variable individual life insurance products for the fourth quarter of 2021.
Combined sales of non-variable indexed universal life and non-variable indexed whole life policies increased 16% between the fourth quarter of 2020 and the fourth quarter of 2021, to $718 million, according to new life insurer survey data from Wink.
Sales of traditional whole life rose 45%, to $1.5 billion.
All life insurance policies provide death benefits, and the COVID-19 pandemic has focused consumers’ attention on the possibility that they could die.
Wink is reporting, for example, that the primary pricing objective for 86% of the individual U.S. whole life policies sold in the fourth quarter was to provide a death benefit; pay the bills associated with funerals, burials and other final expenses; or support wealth transfer arrangements.
In the fourth quarter of 2020, about 84% of the individual whole life policies purchased were used mainly to provide death benefits, pay final expenses or support wealth transfer arrangements.
The percentage of individual whole life policies priced as final expense products fell to 41%, from 50%, and the percentage priced as sources of death benefit or wealth transfer support increased to 45%, from 34%.