First-quarter non-variable universal life insurance sales were down double digits, and hit an “all-time low” according to the 95th and latest edition of Wink’s Sales & Market Report.
The first quarter, 2021 life sales results showed non-variable universal life sales for were $649.8 million; down 12.1% when compared to the previous quarter and down 15.6% as compared to the same period last year. Non-variable universal life (UL) sales include both indexed UL and fixed UL product sales.
“Seeing Universal Life hit rock bottom is a personal low for me. I remember developing the most competitive GUL in the life insurance industry 17 years ago; back then, I never would have foreseen that sales would get this bad,” said Sheryl J. Moore, Chairwoman & CEO of Wink, Inc. and President & CEO of Moore Market Intelligence in Des Moines, Iowa.
“This was obviously going to be a tough quarter for life insurance sales. No sooner than we have products repriced for 2017 CSO, we have to reprice for AG49. And now that AG49 is under our belts, everyone is looking at the prospects of repricing for 7702. When product development is active, sales suffer,” Moore added.
Noteworthy highlights for total non-variable universal life sales in the first quarter included National Life Group gaining the No. 1 overall sales ranking for non-variable universal life sales, with a market share of 11.9%. Allianz Life’s Allianz Life Pro+ Advantage IUL was the top-selling product for non-variable universal life sales, for all channels combined.
Indexed life sales for the first quarter were $530.6 million, down 14.6% when compared with the previous quarter, and down 0.7% as compared to the same period last year. Indexed life sales include both indexed UL and indexed whole life.
The Wink report noted items of interest in the indexed life market included National Life Group gaining the top ranking in indexed life sales, with a 14.4% market share. Pacific Life Companies, Transamerica, Nationwide, and Allianz Life rounded out the top five, respectively.
Allianz Life’s Allianz Life Pro+ Advantage IUL was the No. 1-selling indexed life insurance product, for all channels combined. The top pricing objective for sales this quarter was Cash Accumulation, capturing 74.1% of sales. The average indexed life target premium for the quarter was $ 12,279, a decline of more than 2.0% from the prior quarter.
Fixed UL first quarter sales were $119.7 million, up 0.6% when compared to the previous quarter and down 50.9% as compared to the same period last year. Noteworthy highlights for fixed universal life in the first quarter included the top pricing objective of No Lapse Guarantee capturing 41.6% of sales. The average UL target premium for the quarter $5,021, a decline of more than 6.0% from the prior quarter.
Whole life first quarter sales were $1.0 billion, up 4.5% when compared with the previous quarter, and up 4.0% as compared to the same period last year. Items of interest in the whole life market included the top pricing objective of Final Expense capturing 54.9% of sales.
The average premium per whole life policy for the quarter was $2,675, a decline of more than 25.0% from the prior quarter.
“As forecasted, whole life sales are going to continue to be strong for the foreseeable future. The guarantees become more valuable during periods of sustained low interest rates,” Moore said.
Not surprising
Interest rates are tanking and fixed rate insurance products (IUL included) will all see rate reductions and for a very, very long time.
Fixed life premiums are going to need to be higher and the days when you could expect to get an 8% IRR at death on a GUL are probably gone forever.
Interest rates are tanking and fixed rate insurance products (IUL included) will all see rate reductions and for a very, very long time.
Fixed life premiums are going to need to be higher and the days when you could expect to get an 8% IRR at death on a GUL are probably gone forever.
VUL-G is now less costly than GUL so that's certainly siphoning off some fixed business.