Customers rush to buy variable universal life insurance
What do you want to know
- The number of VUL policies sold increased by 28% year-on-year.
- Sales of indexed universal life insurance also increased.
- The number of policies and the volume of premiums for sales of whole life insurance policies have moved in different directions.
Customers who bought individual life insurance in the United States in the first quarter were hungry for policies designed to perform well when the stock market is doing well, according to new market data from LIMRA.
Variable universal life policies, or policies that combine a minimum level of policy cash value growth with the potential to do better when mutual fund-style investment funds thrive, have been the undisputed leader in sales.
The number of VUL policies sold increased by 28% year-on-year.
The amount of annualized premium income to be paid to these VUL policies has increased by 50%.
Issuers of index-linked universal life policies, or policies that partially tie policy cash value growth to the performance of investment indices, also posted increases in the number of policies sold and annualized premiums.
Fixed universal life and whole life numbers were mixed, and term life numbers were down.
What this means
In the first quarter, many clients were still making decisions based on the belief that over the long term, investment markets were likely to do well.
The new figures are relevant for retirement planners as well as insurance advisors, as many purchasers of VUL policies, indexed universal life policies and other cash value policies are using the policies in retirement planning. retirement income and long-term care planning arrangements.