Life Insurance Application Flow Slows Again
Application volume for people ages 71 and older held up the best.
Inflation, market gloom and a scarcity of life insurance agents cast a shadow over U.S. life insurance application activity in September.
Overall application activity was 7.8% lower last month than in September 2021, according to MIB Group’s new U.S. application activity report.
The news about falling application rates comes as COVID-19 case counts are rising sharply in Europe, and a deadly Ebola outbreak has infected about 63 people and killed at least 29 since Sept. 20, according to the World Health Organization.
What It Means
Some life insurers that focus on selling protection insurance to “middle-market” customers reported having trouble with hiring and training new agents from the start of the pandemic until earlier this year.
That hiring slump might have contributed to the sales chill caused by the effects of rising prices and headlines about stock market turmoil.
You may need to take extra steps to make sure that clients have a suitable amount of life insurance to protect their families against a sudden surge in COVID-19, or even a wave of Ebola cases.
MIB
MIB is a Braintree, Massachusetts-based organization that helps life insurers process the information used in underwriting applications for life insurance and other products.
The group draws the application statistics from its own application flow records.
Here are the activity change figures, for September, for applicants in five different age groups:
- Ages zero-30: -6.3%
- Ages 31-50: -11.2%
- Ages 51-60: -7.7%
- Ages 61-70: -2.0%
- Ages 71 and older: -0.5%
Here’s how activity changed for three different types of life insurance products:
- Term life: -7.6%
- Universal life: -6.5%
- Whole life: -10.9%
The Policygenius Price Index
Policygenius, a web broker, has been using pricing information for the 20-year, level-premium term life policies it sells online to provide a monthly term life price index.
The cheapest coverage included is for a 25-year-old female nonsmoker who needs $250,000 in death benefits, and the most expensive is for a 55-year-old male smoker who needs $1 million in death benefits.
This month, the lowest price in the Policygenius price tables, for the 25-year-old female nonsmoker seeking just $250,000 in coverage, fell to $14.20, from $14.21 in September.
The highest price, for the 55-year-old male smoker seeking $1 million in coverage, fell to $1,011.93, from $1,015.76 in September.
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