Indexed universal life (IUL) sales as a percent of all universal Life (UL) sales rose to 31 percent during the first nine months of 2013 from 14 percent in 2010, according to Milliman's annual study of UL and IUL issues. In recent years more companies have entered the IUL market.
The survey’s 26 participants — among them industry titans like Allianz Life, MetLife, Prudential Financial and Thrivent Financial — indicate they will devote more resources to developing and marketing cash accumulation IUL and current assumption IUL products, while reducing their focus on universal life with secondary guarantees (ULSG). Five of the 26 survey participants have discontinued sales of ULSG products.
“The popularity of chronic illness riders has also increased over the last few years,” the report states. “Fourteen participants currently offer a chronic illness accelerated benefit rider on either a UL or IUL chassis. During the first nine months of 2013 sales of chronic illness riders as a percent of total sales were 11 percent for UL products and 33 percent for IUL products.
“The majority of participants that reported UL/IUL sales with a chronic illness rider provide a discounted death benefit as an accelerated benefit,” the report adds. “Similarly, during the first nine months of 2013, sales of long term care (LTC) riders as a percent of total sales were 17 percent for UL products and 9 percent for IUL products. Nearly 85 percent of survey respondents expect to market either an LTC or chronic illness rider within 12 to 24 months.”