Older Baby Boomers Drive Uptick in 71-and-Up Life Application Activity

What You Need to Know

The overall individual life activity level was 1.4% lower in May than in May 2021.
The activity level for applicants ages 71 and older was up 10%.
Demand from clients who needed between $1 million and $2.5 million in coverage increased.

Your clients might be more likely to be using life insurance for long-term care planning and as a defense against uncertainty about estate tax rules.

MIB Group has included data raising those possibilities in its latest monthly U.S. individual life insurance application activity report.

The overall individual life activity level was 1.4% lower in May than in May 2021.

The Index

MIB is a Braintree, Massachusetts-based group that helps life insurers exchange some of the data used to evaluate life insurance applicants. The index figures are based on MIB’s own underwriting system activity levels.

The MIB activity index has been more volatile than usual over the past two years. The COVID-19 pandemic caused a sharp slump in sales from around April 2020 until late in 2020, followed by a big spike as pandemic-related upheaval eased and pent-up demand for coverage pushed clients to fill out applications.

The year-over-year drop in May was the smallest MIB has recorded this year. In April, for example, the MIB activity index was 12% lower than in April 2021.

The Details

Here are the activity change figures, broken down by age group, for May:

Ages zero-30: down 2.6%
Ages 31-50: down 1.4%
Ages 51-60: down 2.8%
Ages 61-70: down 1.8%
Ages 71 and older: up 10%

Here’s what happened to activity changes, broken down by product type:

Universal life: down 0.1%
Term life: down 0.6%
Whole life: down 9.3%

MIB did not give percentage change figures broken down by death benefit level, but it did note that activity was up for death benefit amounts under $250,000, and for amounts ranging from $1 million to $2.5 million.

Price Stability Continues to Plague Policygenius Price Index

Policygenius, a life insurance web broker, began using its term life pricing information — for 20-year, level-premium term life — to create a stream of monthly term life price index data.

The cheapest coverage included is for a 25-year-old female nonsmoker who needs $250,000 in death benefits, and the most expensive is for a 55-year-old male smoker who needs $1 million in death benefits.

Policygenius introduced the index when the COVID-19 pandemic was under way. Since it introduced the index, inflation has roared back into public consciousness.

In spite of all of that drama happening in the economy as a whole, the insurers that feed Policygenius data have stuck with stable, undramatic pricing. This month, the lowest price in the Policygenius price tables held steady, at $14.21. The highest price, for the 55-year-old male smoker, held steady at $1,016.10.