Life insurance applications on the wane in 3Q, MIB reports

New data from MIB Group reveals good news and bad news regarding life insurance activity.

Life insurance applications finished the third quarter 2022 down -6.3% year-to-date compared to 3Q 2021. However, when taking a historical lookback, YTD activity was down -5.9% compared to Q3 2020 but up 2.6% compared to pre-COVID-19 levels in Q3 2019, MIB Group said.

On a year-over-year basis, September 2022 activity was down 7.8% compared to September 2021 and activity during Q3 2022 finished down 6.8% compared to activity during Q3 2021. Additionally, when comparing Q3 2022 to the previous quarter (Q2-2022), activity was flat at -0.03% in a pattern similar to last year, but in contrast to long term historical results where Q3 traditionally has lower activity than Q2.

Activity for ages 0-70 showed year-over-year declines in September, in the double digits for ages 31-50, while ages 71+ saw flat activity. On a quarterly basis, Q3 2022 saw YOY and YTD declines compared to Q3 2021 for ages 0-70 and growth for ages 71+. MIB pointed out that Q3 2022 represents the sixth consecutive quarter that ages 71+ has outpaced other age bands in quarterly YOY application activity.

September saw YOY declines for face amount up to and including $1 million, growth for face amounts over $1 million up to and including $5 million, and flat activity for amount over $5 million. When comparing activity during Q3 2022 to activity during Q3 2021 YOY, face amounts over $1 million up to and including $5 million saw flat activity while all other face amounts saw declines, MIB reported.

When examining age bands for activity during Q3 2022 compared to activity during Q3 2021 YOY, ages 0-30 saw declines for face amounts up to and including $250,000 and growth for face amounts over $250,000, in the double digits for face amounts over $2.5 million. Age 31-50 saw declines for face amounts up to and including $1 million and amounts over $5 million, in the double digits for amounts up to and including $250,000, and flat activity for other face amounts.

Ages 51-60 saw declines for face amounts up to and including $1 million, flat activity for amounts over $1 million up to and including amounts $5 million, and double-digit decline for amount over $5 million. Ages 61-70 saw flat activity for amounts up to and including $250,000 and declines for all other face amounts, in the double digits for amounts over $2.5 million, MIB reported.

Ages 71+ saw growth for face amounts up to and including $250,000, and declines for all other face amounts, in the double digits for amounts over $250,000 up to and including $5 million.

All product types experienced YOY declines in September. Universal life saw declines of 6.5%, term life of 7.6%, and whole life saw double-digit declines of 10.9%. Similarly, when comparing activity during Q3 2022 to activity during Q3 2021 YOY, all product types saw declines, in the double digits for Whole life, MIB said.

When breaking down the Q3 2022 to Q3 2021 YOY comparison by age bands, only universal life for ages 71+ was at growth. All other age bands across all other product types were either flat or declined. Specifically, term life saw flat activity for ages 0-30 and 71+ while all other age bands saw declining activity. Universal life saw declines for ages 0-60, in the double digits for ages 31-50, flat activity for ages 61-70, and growth for ages 71+. Whole life saw declines for ages 0-70, in the double digits for ages 0-60, and flat activity for ages 61-70.