DOW JONES NEWSWIRES
Annualized life-insurance premium sales fell 23% in the first
half of the year, the steepest slump in 67 years, but the rate of
decline in the second quarter slowed from the quarter before, Limra
said Monday.
Life insurers have been battered the past year by billions of
dollars in investment losses and write-downs amid the slumping
stock market. Last month, the largest U.S. life insurer, MetLife
Inc. (MET), swung to a loss on big investment losses linked to
derivatives.
Industrywide premium sales fell 20% in the second quarter after
a 26% drop in the first, said Limra.
The organization of life insurers and other financial firms said
policy counts continued to drop, down 4% in the second quarter and
6% in the first half. Every product declined in the most recent
period except universal life, which increased 8%.
Variable sales, which have the strongest ties to the market,
suffered most, down 50% in the second quarter and 55% percent in
the first half. They had been among the biggest concerns for the
life-insurance industry as the stock market slumped because such
policies carry guaranteed minimum concerns. Without a rebound,
observers were concerned if anniuty sellers would be able to make
good on the policys without falling into dire straits.
Whole life and and term life insurance again were the most
resilient, both posting sales declines in the low single digits in
both periods.
However, Limra said that 40% of companies were able to increase
their total individual life sales in the second quarter over the
previous year. Yet in the first half, the policies that were sold
were slightly smaller.
-By Joan E. Solsman, Dow Jones Newswires; 212-416-2291;
joan.solsman@dowjones.com