You only need two words to describe the voluntary benefits industry's sales last year: "up again." Or, if you prefer, "historic highs."
You may recall voluntary sales grew a solid 5.4% in 2022 — quite respectable as the industry emerged from the lingering effects of the pandemic. But last year topped that with a 6.7% jump, according to Eastbridge Consulting Group's annual "U.S. Voluntary/Worksite Sales Report." That pushed total sales premium to $9.34 billion, the industry's highest level ever. In-force premium also reached historic highs in 2023 by growing almost 5.5% to $53.3 billion.
Benefit brokers and career agents lead the way
Benefit brokers — those who primarily sell core or employer-funded products but also sell voluntary benefits — beat the industry average with 7% sales growth in 2023. These brokers produced total sales of $6.3 billion, or 68% of the total market.
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Not to be outdone, career agents and classic worksite brokers both saw sales growth of 11% last year. Career agents, who primarily work for a single company selling its products, account for 13% of the market, while classic worksite brokers who focus on voluntary benefits hold 10%. Worksite specialists — large marketing organizations that focus on voluntary sales — kept their grip on 8% of the market, despite a slight dip of 0.2% in sales.
Get a life (product)
If you're like many brokers, life insurance is the go-to product in your portfolio. Term life sales were up 10% to more than $2 billion in 2023, keeping that coverage firmly in the number-one position with nearly 22% of all voluntary sales. Universal life and whole life sales increased nearly as much at 9%, totaling more than $800 million. Together, all types of life insurance account for 30% of the market.
And life insurance isn't the only business line where you and your colleagues saw success last year. In fact, sales of almost all types of voluntary coverage grew in 2023: critical illness was up 7% year over year, hospital indemnity increased 6%, dental grew 5%, and short-term disability and accident were each up 4%. Cancer, vision and AD&D — while representing a much smaller portion of the market — all had double-digit growth last year.
Bottom line is looking up
Last year's sales show the voluntary industry has recovered from the pandemic — but wait, there's more. Our research continues to show brokers are optimistic about the future of voluntary benefits, and they expect their clients and clients' employees to continue to be enthusiastic about these products, too.
Sounds like we might be repeating those two little words again this time next year, and likely all four: "up again" and "historic highs."
Eastbridge's "U.S. Voluntary/Worksite Sales Report" provides includes data from 2000 through 2023 from 60 companies, primarily on group and individual life and health products. Carriers participating in the study receive a free copy of the complete findings, including company-specific results. Carriers interested in participating in next year's study can email Eastbridge at [email protected].
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