Milliman: COVID-19 Drives Decrease In Individual Disability Income Sales
Milliman, Inc., a premier global consulting and actuarial firm, today released the results of its latest Individual Disability Income (IDI) Market Survey. The report, in its fourteenth edition, measures sales trends across 15 IDI companies, representing over 90% of the market.
The survey also covers recent changes in underwriting and product design, the range of views that companies have on the current profitability of their business, and the favorable and unfavorable trends that can affect the long-term profitability of the IDI market.
Key findings include:
The combined new IDI annualized premium issued in 2020 for all 15 companies decreased by 5.3%, dropping to $381 million from $402 million in 2019.
Among the 15 companies, the highest annual growth rate in 2020 was 15%; the lowest was negative 32%. Only four of the 15 companies reported positive growth in new premium in 2020. The overall drop in new sales premium is likely largely attributable to the COVID-19 pandemic.
The percentage of new IDI annualized premium in 2020 issued to doctors and surgeons was 34%, compared to 32% in 2019.
The employer-sponsored multi-life market continues to increase its share of new IDI annualized premium, reaching 45% in 2020.
The new IDI annualized premium issued in the first half of 2021 decreased by 4% compared to new premium issued in the first half of 2020.
"Uncertainty from the COVID-19 pandemic and related product marketing challenges affected new sales growth, and is likely why we saw a decrease in premium in 2020," says Tasha Khan, a principal at Milliman and co-author of the report. "We also saw more companies than usual cite low interest rates as a market challenge, compared to prior surveys."
Milliman is among the world's largest providers of actuarial and related products and services. The firm has consulting practices in healthcare, property & casualty insurance, life insurance and financial services, and employee benefits. Founded in 1947, Milliman is an independent firm with offices in major cities around the globe. For further information, visit www.milliman.com.