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Life insurance sales continue to improve in Q3

Life Insurance and Annuities
by Mark Birdsall
Liquidity in life insurance is useful in some situations.
Liquidity in life insurance is useful in some situations.

While there has been considerable uncertainty about the future of the U.S. economy under the new tax bill, {this could come across as political. there has not been a significant disruption of life insurance sales to this point. In fact, through the end of the third quarter, it was starting to look as though sales of indexed universal life insurance policies would hit a record high by the end of 2017.

In the third quarter of the year, IUL sales hit a record $479.5 million nationwide, down 1 percent from the second quarter of the year but up 6 percent on an annual basis, according to the latest data from Wink's Sales and Market Report. Meanwhile, all universal life sales hit $533.6 million in the quarter, while whole life sales came in at about $1 billion.

"We'll see a strong close at the end of the year for cash-value life insurance - index life, universal life and whole life," said Sheryl Moore, president and CEO of Moore Market Intelligence and Wink Inc., publisher of Wink's Sales and Market Reports.

Moore further noted that the third-quarter trend likely portended good news for the final three months of the year as well, as that's when IUL sales typically reach their peak for the year. If that happens, 2017 will likely surpass the record year seen in 2016, when sales reached a total of $1.8 billion.

Life insurance sales could reach record highs this year.Life insurance sales could reach record highs this year.

Millennials lagging behind?
While there is plenty of evidence to suggest that the number of young adults who are buying life insurance for themselves and their loved ones is on the rise, the paucity of enrollees prior to the past few years means that there's still plenty of work to do, particularly among millennials who are now starting families, according to The Motley Fool. A recent poll found that the vast majority of millennial parents don't have life insurance at this point, citing a lack of time to assess their options properly.

Of course, experts recommend that any parent have significant life insurance protection in place to insulate their children and loved ones from financial difficulties in the wake of an unexpected or untimely death, but evidence suggests that many young people don't sign up because they have difficulty correctly assessing costs and don't think they can afford it, typically despite the existence of low-cost term-life coverage.

Bridging the gap
Often, the problems that lead to millennials failing to enroll in life insurance coverage are those of misconceptions, according to Property Casualty 360. Failure to fully understand how certain types of life insurance are priced is certainly an issue here, as is the concern about how long or involved the sign-up process might be. The good news is that many life insurers are constantly rolling out new offerings designed to more directly appeal to millennials, who now constitute a generation with considerable buying power rivaled only by the baby boom generation.

With these issues in mind, though, more may need to be done on the part of insurers or brokers to make sure millennials know about all their options and have relatively easy access to coverage that will fit their specific financial needs both now and going forward.



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