Gen Re recently released the results of a new survey, indicating a positive year for individual disability insurance sales, with notable growth in several key areas. The 2023 US Individual Disability Market Survey, which includes data from 17 participating companies, revealed increases in both in-force and new sales premiums.
Overall, the total in-force premium rose by 2% compared to 2022, reaching $5.4 billion. This includes premiums from Non-Cancelable (Non-Can), Guaranteed Renewable (GR), and Buy-Sell products. The new sales premium saw a more significant increase, growing by 7% to $490 million.
Non-can products, which constitute the majority of the market, showed stable growth, according to Gen Re. In-force premium increased by 2% to $4.6 billion, making up 84% of the total in-force premium. New sales premium for non-can products rose 8%, totaling $413.5 million.
GR products experienced a 4% increase in in-force premium, amounting to $793 million. New sales premium for GR products grew by 3% to $73.7 million.
Despite a 4% decline in in-force premium to $47.1 million, Buy-Sell products saw a resurgence in new sales, which increased by 14% after a significant drop in 2022. The number of new Buy-Sell policies issued grew by 11%.
The total number of policies in force remained steady at 3.1 million, while new policies issued increased by 4% to 275,235. The total benefit amounts for new policies rose by 9% to $1.6 billion.
GSI products saw a mixed performance. Total GSI new sales premium decreased by 4% to $65.8 million, with non-can GSI making up the vast majority. In contrast, GSI in-force premium grew by 5% to $460.2 million. Employer-paid business represented 60% of the total GSI new sales premium, while employee-paid accounted for the remaining 40%.
For non-can new business, disability income (DI) products dominated with $404.1 million in premiums, while overhead expense (OE) products contributed $9.4 million. Growth varied by occupation, with premiums from medical and high-earning occupations (4A & Above) growing by 7%, and premiums from lower-earning occupations (2A & Below) increasing by 22%.
In GR products, DI accounted for almost all new sales premium at $73.6 million. While premiums from higher-earning occupations remained steady, those from lower-earning occupations saw the largest growth.
The Buy-Sell market continued to face challenges, with in-force premium declining for the 15th consecutive year. However, the increase in new sales premium and the number of new policies issued in 2023 indicated a potential turnaround.
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