A report from the Life Insurance Marketing and Research Association (LIMRA) shows that new annualized premiums for individual life insurance fell 7% in the first quarter 2014, while policy count declined 4% percent during the same period.
LIMRA says the decline is partially driven by universal life (UL) sales, which fell by 48% after companies repriced or readjusted features on their UL products.
Indexed UL (IUL) and variable universal life (VUL) sales, however, improved with 15% and 20% increases respectively. LIMRA notes that there have been several new entrants to the IUL market, and that the product now accounts for 39% of UL sales and holds 14% of the market in total individual life premiums. In 2007, IUL's market share was only 8%.
Whole life sales have tapered off after 18 consecutive quarters of positive growth, with new annualized premium down by 3% and policy count down by 4% during the quarter.
As for term life insurance, new annualized premiums fell 4% in the first quarter 2014, with two thirds of term writers reporting negative growth compared to prior year. LIMRA notes that term experienced significant growth in 2013 because several companies had reintroduced traditional term products to replace their term UL products.