For the seventh quarter in a row, life insurance premium has grown by a respectable amount. According to the latest data on life insurance premium sales from LIMRA, total individual life premium increased by 4 percent in the first quarter of 2016. Compared to the same period of time in 2015, the total number of life insurance policies also grew by 3 percent.
“Individual life insurance sales had a good start to the year with growth across all major product lines except variable universal life,” Research Associate Director Ashley Durham said, according to LIMRA. “Consistent with 2015, whole life drove the overall growth in first quarter 2016. With the market volatility, it’s not surprising that people are attracted to the protection and guarantees these products offer.”
“Life insurance sales continue to grow in 2016.”
Sales of universal life also experienced modest growth. LIMRA found that these policies saw an additional 1 percent in premium compared to the same period in 2015. This is despite the fact that universal life premium made up 37 percent of all premium collected in the first quarter of 2016.
Whole life products also saw good returns, with annualized premium growing 11 percent over 2015. According to LIMRA data, this was the single biggest factor in the growth of individual premium. These leading factors meant that 65 percent of life insurance providers reported positive growth to LIMRA in the first quarter. That included 70 percent of the top 10 carriers.
Sources of growth
With such a long history of positive sales growth, many financial professionals may be wondering where it is all coming from. Chances are good that much of the growth in new premiums can be attributed to younger buyers. According to LIMRA’s 2016 “Insurance Barometer” study, around one in three Millennial consumers surveyed said they planned on buying life insurance within the next year. In fact, 15 percent of all consumers surveyed by LIMRA said they were “very or extremely likely” to make a life insurance purchase soon.
This high level of interest in life insurance products and strategies is certainly related to the equally high sales of premium and policies. Financial professionals can hope to see continued gains in this realm if they focus on the next generation of consumers, many of whom are already searching hard for the right advisor and provider for them.