Credit: Yuriy Nedopekin/iStockTechnical problems caused a 33% drop in dental sales at Aflac in the fourth quarter of 2024 — and they also hurt sales of the company's other voluntary and worksite insurance products.
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Virgil Miller, president of Aflac's Aflac U.S. unit, talked about the system problems Thursday, during a conference call with securities analysts.Recommended For You
"We had a failed system implementation that we were recovering from," Miller told the analysts.
A third-party administrator helped Aflac recover from the system problems, but the problems hurt efforts to get brokers and agents interested in Aflac's dental and vision plans throughout the quarter, Miller said.
"Quite frankly, we did not get the response that we needed," Miller said.
Total U.S. dental and vision sales fell to $25 million, from $33 million in the fourth quarter of 2023.
Aflac normally gets a "halo," or extra voluntary benefits sales, when it sells dental insurance, Miller said.
Because of the drop in dental sales in the fourth quarter, Aflac also had trouble selling other products.
The earnings: Aflac held the call to go over earnings for the quarter.
The company reported $1.9 billion in net income for the latest quarter on $5.4 billion in revenue, up from $268 million in net income on $3.8 billion in revenue for the fourth quarter of 2023.
Aflac gets much of its revenue by selling cancer insurance and other products in Japan.
The Aflac U.S. unit reported $330 million in pretax adjusted earnings on $1.7 billion in revenue, compared with $302 million in pretax adjusted earnings on $1.6 billion in revenue in the year-earlier quarter.
The company's critical care insurance products, such as critical illness insurance, could benefit from the Trump administration's efforts to ease fixed indemnity insurance product rules. Sales of those fell to $115 million, from $124.
Sales of another type of product that could benefit from eased indemnity insurance product rules, hospital indemnity insurance, fell to $76 million, from $83 million.
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Allison Bell
Allison Bell, a senior reporter at ThinkAdvisor and BenefitsPRO, previously was an associate editor at National Underwriter Life & Health. She has a bachelor's degree in economics from Washington University in St. Louis and a master's degree in journalism from the Medill School of Journalism at Northwestern University. She can be reached through X at @Think_Allison.
