Consumers in the U.S. showed a preference for a combination of benefits growth potential and benefits guarantees when they bought individual life insurance policies in the second quarter.
The number of indexed universal policies sold was 22% higher in the latest quarter, which ended June 30, than in the year-earlier quarter, according to new issuer survey data from LIMRA. The Windsor, Connecticut-based research organization reported that the total number of individual policies sold increased by 4%. The total amount of premiums paid for the new individual policies sold during the quarter increased 2%, to $4 billion.
John Carroll, a senior vice president at LIMRA, said he thinks that economic conditions for middle-income families are improving and that consumers may have felt more confident about buying coverage.
That could be a sign that the Federal Reserve Board will, in turn, be confident enough about the economy to continue to push up interest rates. If rates keep moving higher, that could help increase the crediting rates available from issuers’ new CDs, bonds, life insurance policies and annuities but hurt clients’ stocks, bond portfolios and exposure to variable-rate debt.
The Policy Counts
LIMRA creates quarterly policy sales reports and many other reports using survey responses from member insurers. Here’s what happened to the number of policies sold, for five types of coverage, between the first quarter of 2022 and the first quarter of 2023:
- Indexed universal life: +22%
- Term life: +4%
- Whole life: +3%
- Variable universal life: -2%
- Fixed universal life: -12%