Total new individual life annualized premiums improved 2 percent in the 2010 fourth quarter, for a 4 percent growth for the year, according to LIMRA's U.S. Individual Life Insurance Sales Survey.
"Throughout the year, whole life and universal life were strong performers, spurring an increase of overall individual life insurance sales," says Ashley Durham, senior analyst, LIMRA product research. "While we have not gotten back to the peak level reached in 2007, we are encouraged by the positive results this year."
In the fourth quarter of 2010, new whole life annualized premiums improved 14 percent and 15 percent for the year. Policy sales also increased 6 percent for the quarter and 2 percent for the year. Almost 60 percent of the writers grew their whole sale premiums this year, including all but one of the top ten. This marks the sixth consecutive quarter of growth for whole life sales.
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New universal life annualized premiums also performed well in the last quarter of 2010, with a 13 percent increase. Universal life premium sales grew 10 percent, which brings its market share back to 41 percent. Policy count rose as well, finishing at a growth of 20 percent for the quarter and 21 percent for 2010.
Sixty percent of universal life writers increased their premium sales from 2009, including 15 of the top 20, while products featuring long-term secondary guarantees dropped slightly to 5 percent, compared with 2009. However, premium sales for products without these guarantees increased 27 percent.
In 2010, indexed universal life sales grew 47 percent, which is nearly 20 percent of 2010 universal life annualized premium sales.
"Many factors contributed to indexed UL growth, including increased marketing, training and product introductions," Durham says. "Indexed UL sales are also benefiting from the current economic environment. Like other indexed products, indexed UL products' cash value can grow with market but are also protected against severe market declines."
Term life insurance premiums faced a 16 percent drop for the quarter and a 12 percent decline for the year, which was the same for term policy sales. This is the largest annual decline for term on record the decline was attributed to companies dropping product lines and increasing prices.
Variable sales underwent a decline in the fourth quarter of 25 percent. Year-end results were down 7 percent from 2009.
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