Over the past few years, the number of Americans who could afford to buy life insurance and were motivated to do so increased dramatically. That's a trend that could also continue for some time to come as the economy continues to improve and more workers find themselves on solid financial ground. Certainly, this has been the case in recent months.
In the first quarter of the year, the total value of indexed life insurance sales came to $446.5 million, up 3.4 percent from the first quarter of 2016, according to latest Wink's Sales and Market Report. While that number was down 16.4 percent from the fourth quarter of last year, it nonetheless set an all-time record for indexed life sales.
"This quarter, indexed life insurance sales were greater than they have ever been in any first quarter, since their introduction 20 years ago," said Sheryl Moore, President and CEO of both Moore Market Intelligence and Wink, Inc. "I don't find the sales decline from last quarter remarkable; that is just a cyclical trend in sales of life insurance products."
In addition, non-variable universal life insurance sales came to more than $930.3 million in the quarter, and sales of fixed UL sales came to $484.6 million, the report said. Finally, whole life sales hit a total of $933.1 million.
However, separate data from the latest MIB Life Index shows that individually underwritten life insurance activity actually fell somewhat in May, sliding 2 percent year-over-year for the month and 3.3 percent year-to-date on an annual basis. Indeed, so far this year activity has been down in each of the first five months. There is some good news, though: Application activity is in line with seasonal norms, and young people in particular continue to be roughly as interested in such coverage. Indeed, MIB notes that purchases of coverage among people between the ages of 45 and 59 have made up the large bulk of the declines in activity seen so far this year.
When it comes to life insurance, it seems that many younger Americans continue to be unsure about what kind of coverage will be appropriate for them, and how much they can expect to pay for it, according to Erie Insurance. To that end, it's important for those who currently lack coverage but need it - such as younger families - to explore all the options that may be available to them, as well as get a better understanding of which life events might arise that would necessitate more coverage, and which aren't necessarily likely to affect their life insurance needs.
The better people understand the ins and outs of life insurance, the better off they will be to find coverage that meets their unique needs both for their current financial situations and those they're likely to see in the future. Working with agents or insurers on this issue not only at the initial point of purchase but on an ongoing basis can provide a solid foundation for smart decisions.