After two consecutive months of decline during the pandemic quarantine, U.S. life insurance application activity jumped 5.2% YOY in May in what appears to be a V-shaped recovery, according to the latest MIB Life Index, released this week.
The recovery, using month-over-prior month comparisons, was even more impressive—February/March was off -6.7%, March/April off was -5.5%, and April/May bounced back an unprecedented 1.5% in a time period historically off -5.0% or more as the summer months approach.
On a YOY basis, May 2020 index was up 5.2% with two less business days than in the 2019 comparative period. Year-to-date, the composite MIB Life Index is a percent higher than last month, up 1.6% at the end of May.
May’s Life Index age groups showed strength in the younger and middle ages. Ages 0-44 gained 7.1%, ages 45-59 gained 6.9%, ages 60+ were off -1.9% YOY. Year-to-date, ages 0-44 are up 3.4%, ages 45-59 are up 0.5%, and ages 60+, while down -1.6% YTD, remain about 10% higher than pre-2019 numbers.
As carriers and agents adjust to the new normal and society returns, we remain cautious about identifying any trends given the impact of the COVID-19 exogenous event.
Looking at month-over-prior month (MOM) gain/loss (April 2020/May 2020), application activity ages 60+ showed the greatest recovery from COVID-19 declines up 4.4%, ages 45-59 gained 1.2%, and ages 0-44 gained 0.6% MOM.
The MIB Life Index provides a monthly snapshot of the underwriting activity for the U.S. life insurance industry. It is based upon the number of searches member company underwriters perform on the MIB Checking Service database (MIB Checks), a highly standardized, ubiquitous measure.
Given that MIB member companies underwrite over 95% of the premium dollars of all individually underwritten life insurance policies issued in the U.S., the Index is an extremely robust measure and the life insurance industry’s timeliest measure of underwriting activity.