- 4,576
Agree. I just think there is a 6-18 month lag time on data being updated in some cases. So, maybe excess mortality will be slower to see but insurers are quicker to report paid claims than govt data bases being updated
Pandemic leads to highest life insurance payouts on record
- Thread starter Insurance Forums Staff
- Start date
Agree. I just think there is a 6-18 month lag time on data being updated in some cases. So, maybe excess mortality will be slower to see but insurers are quicker to report paid claims than govt data bases being updated
Insurers are also omitting the increased revenues/profits generated during the pandemic, and while the pandemic won't last forever, many of those recently purchased policies will generate ongoing premiums lasting decades.
- 4,576
I think that has been pretty public that sales & premiums are up. But if you think the life & Annuity industry is killing it, tell me why so many carriers in the last decade have quit selling life & some have even sold their billion dollar life books for $0 to hedge funds just to get it off their books as it is such a drain on their overall surplus. Albeit, new sales priced today are certain to be much more profitable than all those old policies on the books priced with old interest rates
I'm not saying they are killing it, but offering a balanced perspective. I think when everything finally shakes out, overall, covid will be a positive rather than a negative. It's been a great way to promote the Life industry without a huge (or any) increase in marketing budgets.
- 4,576
I hope you are right, but my money is in the opposite direction.
The governments printing of money causing inflation & all the labor cost/tech cost increases have hurt expense ratios. Surplus being limited to being mostly invested in low interest rate instruments is making the other part of the profit equation deteriorate. Mortality worsening compared to priced mortality adds to expenses & drains on surplus & now will also come with much higher reinsurance premiums. More employees working fom home has caused bad customer service from carriers, IT vendors to the carriers & to agents.
I am not sure a 10% jump in 1-2 years individual sales will absorb all that. But, I would be glad to be wrong & tell you that you were right.
We are talking about 10 additional deaths per 100,000 people so only insurers who were living on the edge of profitability are likely to be impacted greatly.
- 4,576
Yeah-- i get that, but seeing big numbers like $5.5B in death claims after 9 months when 2020 was $3.5B for entire year which was up from I believe about $2.8B seems like a bigger deal than just 10 additional deaths per 100,000 of population
Hard to believe it was related mainly to the pandemic if you ask me. The numbers just don't seem to jive with the mortality statistics, unless it was just a bad year for high net worth clients with huge policies?
- 2,195
How so?
- 4,576
that is why I am saying you are likely looking at death stats that have a lag time of being updated whereas carriers post filed claims quickly relatively speaking. I know the small single state multi-line carrier I work with is up $10M in claims (25%) in 2021 & up even more in the number of claims as many were small face WL from literally the 1950s-1970s one age 70-95 year olds. But there was also higher claim volume & face amount term on younger clients on all the reports the field gets to see each month regarding life claims
