U.S. life insurance application activity lost ground monthly in all but the final two months of 2017 according to the MIB Life Index, most recently updated on Jan. 16.
Application activity started to slow in mid-2016, and dropped by 4.5% in the first quarter of 2017 before rebounding somewhat in the subsequent three quarters to finish the year at -1.8%.
November and December were up 1.2% and 1.0%, respectively year-over-year, demonstrating an upward trend heading into 2018.
Additional support was evidenced by the December/November percent change, off -4.8% — a significantly shallower decline than seasonal norms. In relative terms, the 2017 year-end index value (99.58) is 1.6% higher than levels seen in 2013 (98.03) and .42% lower than par value (100) reset in 2011.1
Younger life insurance applicants (ages 0-44) drove the MIB Life Index in 2017 with both Q3 and Q4 activity up 0.2% and 1.6%, respectively. Application activity in ages 0-44 rose in the last five months of 2017 with November and December up 2.3% and 1.2%, respectively year-over-year. Year-to-date, this demographic finished 2017 off slightly at -0.7%. In 2017, the proportion of ages 0-44 applications vs. the total of all MIB Life Index applications grew by .62%, and now represent 55.2% of the MIB Life Index.
The top 60 MIB life insurers (by volume) had a 3.0% gain in ages 0-44 application activity over the past two years (2017/2015). The 45-59 age group had the greatest shortfall off -4.0% YTD, with monthly declines in all but December, up slightly at 0.6%, year-over-year. Ages 45-59 also declined in total applications by -.63%, now representing 27.0% of the MIB Life Index. Life insurance applicants ages 60+ finished the year off -1.7% YTD, receiving a boost in the final two months of the year, pushing Q4 gains that were close to par value (0.2%). November and December were up 0.9% and 1.3%, respectively year-over-year. Ages 60+ as a percent of total applications stayed level at 17.8% of the MIB Life Index.
“The year-over-year increase in monthly application activity for younger age buyers in the second half of 2017 is validating the industry’s investment in innovative marketing, product design, underwriting and online channels to reach this key segment of the underserved market,” said Lee Oliphant, MIB Group’s Chief Executive Officer. “We remain cautiously optimistic that the positive growth seen in the fourth quarter of 2017 will continue as we head into 2018.”
A full analysis of 2017 can be accessed by logging in to the MIB Life Index Annual Report. Download the 2017 MIB Life Index Annual Report at no charge by registering at the Enhanced Life Index Portal: www.mibsolutions.com/regLI. The “2017 Year-in-Review” video with MIB CEO Lee Oliphant is anticipated in early February.
1The MIB Life Index baseline index value was reset to 100 in 2011. See http://bit.ly/2c908r5 for full details.
About the MIB Life Index: The MIB Life Index is the life insurance industry’s timeliest measure of application activity in the United States. Released to the media each month, the Index is based on the number of searches MIB life member company underwriters perform on the MIB Checking Service database. Since over 90% of life insurance applications in North America include an MIB search, as a routine underwriting requirement, the MIB Life Index provides a reasonable means to estimate new business activity. For past releases, methodology or to subscribe visit www.mib.com/lifeindex.