Overall policy sales fell 11% in Q2 and 9% year-to-date, LIMRA said.
“Our research suggests consumers are more concerned about the impact of rising inflation and a possible economic downturn and, as a result, have cut back on spending, including reducing or delaying the purchase of insurance products,” Carroll said. “While these economic concerns are legitimate, our industry needs to emphasize the importance of life insurance to a family’s financial security.”
Indexed universal life (IUL) new annualized premium was up 27% in the second quarter, resulting in 33% growth for the first six months of 2022. Two-thirds of all carriers reported IUL premium increases, including eight of the top 10 carriers, LIMRA said. Cash-value accumulation IUL products drove the growth, representing 80% of IUL premium. IUL premium held 20% of market share of the total US life insurance premium for the first half, according to the report.
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Variable universal life (VUL) new premium rose 29% in Q2, marking its 19th consecutive quarter of gains. In the first half, new premium rose 38% compared to the same period in 2021. While protection-focused VUL sales rose 5%, the majority of the growth came from accumulation-focused products, which saw nearly 50% growth over Q2. VUL held 13% of premium market share in the first half, LIMRA said.
Fixed universal live new annualized premium fell 14% in Q2 and was down 6% in the first half of 2022. Products with lifetime guarantees saw the largest decline, dropping 32% in Q2. Fixed UL market share remained 7% of the total US life insurance market in the first half.
Whole life (WL) new annualized premium dropped 3% in Q2, compared to the second quarter of 2021, when it rose 25%. Despite the decline, WL new premium growth was 3% higher than the prior year. WL represented a third of the total US life insurance market, LIMRA said.
Term product sales dropped for the third straight quarter. In Q2, term new premium fell 6% from the prior year and was down 4% YTD. six in 10 companies sold less premium than they had in Q2 of 2021. Term products’ market share represented 19% of the total US market in the first half.
“Term and whole life are the mainstay products for a majority of Americans seeking life insurance protection,” said Elain Tumicki, LIMRA corporate vice president and director of insurance product research. “Despite the declines in whole life and term policy sales this quarter, these products represented 86% of policies sold in the first half of 2022. Our research suggests the need for life insurance has never been greater. To address the growing coverage gap in the US, the industry needs to take bold, innovative steps to engage and educate Americans – not just during Life Insurance Awareness Month, but year-round.”