Printer Friendly

Despite NAIC guideline, IUL insurance sales remain healthy.

Byline: Warren S. Hersch

Sales of indexed universal life insurance fell 5 percent in the third quarter of 2016 compared with the year-ago period.

But indexed universal life insurance sales maintained an upward momentum amid industry concerns about a 2015 state-based regulatory guideline governing the product line.

Wink Inc. announced this finding in the 77th edition of its "Wink's Sales & Market Report," which surveys indexed universal life insurance sales on a quarterly basis. The report provides sales by product, company, crediting method, index, distribution and surrender charge period, among other parameters.

Related: Indexed universal life is now the preferred COLI product

Indexed universal life sales totaled $452.9 million in the third quarter ending September 30. This compares with $478.6 million in sales for the third quarter of 2015. In contrast with the year-over-year dip, third-quarter 2016 sales rose 3 percent relative to the second quarter.

"It is amazing to see that indexed life sales continue to thrive in a post-AG 49 environment," says Sheryl J. Moore, president and CEO of both Moore Market Intelligence and Wink. "This is the second-largest third-quarter sales have been in the history of the product line. IUL continues to thrive."

The National Association of Insurance Commissioners's Actuarial Guideline 49 (AG 49), which took effect on Sept. 1, 2015, establishes for policy illustrations a benchmark-crediting rate, one of many moving parts in an indexed universal life insurance policy. The guideline also establishes a ceiling for index values used in policy illustrations, limits loan crediting rates to 100 basis points over a charged rate and requires additional disclosures.

Industry stakeholders have feared that the NAIC guideline would lead to greater uniformity, and thus less innovation, in IUL product design. Because policies must now be illustrated based on their general account, cash values will show in most cases a lower amount than when illustrating using an index.

Among the report's additional highlights:


Transamerica maintains its No. 1 ranking in indexed life insurance sales, with an 11.7 percent market share.


Pacific Life Cos. moved up to the No. 2 carrier position. National Life Group, Minnesota Life, and Nationwide rounded out the top five companies, respectively.


Transamerica Premier Financial Foundation IUL was the No. 1 selling indexed life insurance product for the 11th consecutive quarter.


The average indexed universal life target premium reported for the quarter was $8,232, an increase of nearly 29 percent from the prior quarter.


The average fixed universal life target premium was $5,861, a decline of more than 4 percent as compared to last quarter.

Related: 6 advantages of indexed universal life insurance Indexed universal life: It's just a great investment The huge, untapped audience for IUL marketing

5 alternatives to Indexed Universal Life insurance

No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2016 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:National Underwriter Life & Health Breaking News
Date:Nov 22, 2016
Previous Article:Want useful answers from your clients? Ask better questions.
Next Article:IRS postpones ACA reporting deadline.

Terms of use | Privacy policy | Copyright © 2019 Farlex, Inc. | Feedback | For webmasters