Life insurance and supplemental health insurance down slightly while disability insurance sales rise
WINDSOR, Conn., July 6, 2023—Coming out of the pandemic, workers are stepping back to re-evaluate what they are looking for in a work experience. At the same time, inflation is putting a squeeze on workers as they try to meet daily living expenses.
“Our research reveals that concerns about inflation greatly impacted the benefits decisions of nearly 1 in 4 employees, and had some influence on more than half of all workers,” said Patrick Leary, corporate vice president and director of LIMRA’s workplace benefits research program. “Yet benefits remain a critical part of employment satisfaction. Sixty-two percent of employees say they are at least slightly more inclined to stay with their current employers because of their benefits, while 39% are much more inclined to stay.”
Total workplace disability insurance new premium sales were $1.7 billion in first quarter 2023, a year-over-year increase of 5%. The increase in the first quarter was driven by a 17% increase in short-term disability insurance sales.
Total long-term disability insurance new premium sales were down 5%, while voluntary long-term disability sales were down 15%.
In the first quarter 2023, total workplace life insurance new premium was $1.7 billion, down 2% from prior year results. Term products were down 3%, driven in large part by a decline in voluntary sales. Conversely, permanent products were up 7%, driven by a 23% increase in whole life products.
“The decline in sales this quarter was largely influenced by two of the top workplace life insurance carriers. Combined, these two companies posted a decline of 55% versus a combined increase of 14% for all the other companies in the survey,” said Leary.
Supplemental Health Insurance
In the first three months of 2023, U.S. workplace supplemental health product sales ― accident, critical illness, cancer, hospital indemnity, and other supplemental health insurance products* ― totaled nearly $1.2 billion in new annualized premium, a 2% decline year-over-year.
Losses in total supplemental health premium are primarily attributed to new critical illness sales, which declined 8% in first quarter 2023. New critical illness premium accounts for 34% of all new supplemental health premium in the first three months of 2023. Cancer and hospital indemnity new premium showed gains of 13% and 3%, respectively, and accident sales were flat.
“This is the first time since 2020 that workplace critical illness has not shown quarterly growth, while all other major product lines have shown quarterly growth since the second quarter of 2021,” Leary notes.
LIMRA’s workplace benefits sales surveys for life insurance, disability insurance and supplemental health represent at least 90% of their respective annualized premium markets.
You can find the latest data table with U.S. workplace sales trends in LIMRA’s Fact Tank.
*“Other supplemental health products” represents products that do not fit the other categories, such as gap insurance, minimum essential coverage plans, limited benefit medical, and heart/stroke products.
Serving the industry since 1916, LIMRA offers industry knowledge, insights, connections, and solutions to help more than 700 member organizations navigate change with confidence. Visit LIMRA at www.limra.com.