What Life Insurers Are Saying About Death Now

The number of U.S. deaths was lower in the fourth quarter of 2022 than in the fourth quarter of 2021, when the COVID-19 omicron variant surge was rolling in, according to executives from Equitable, Lincoln Financial, Global Life and other life insurers.

But total excess mortality from all causes is still noticeably higher than it used to be before the COVID-19 pandemic started, executives said.

What It Means

Predicting how long clients will live is more difficult now than it was five years ago.

Life insurers emphasized that they can handle the new normal by increasing prices and taking other steps to manage their claim risk.

Your own clients still need protection against longevity risk, but they also need to pay attention to mortality risk.

The Calls

The executives have been talking about mortality over the past two weeks, during conference calls their companies have been holding with securities analysts to discuss earnings for the fourth quarter of 2022. The companies stream the calls live online and post recordings in the investor relations sections on their websites.

What the Executives Saying

Some life insurers have now tilted away from the individual life market. When they talk about mortality, they’re thinking of mortality at employers’ group life plans.

Some other life insurers continue to offer individual life, and executives at those companies might be thinking of the kinds of people who dominate the typical life insurance agent’s or financial advisor’s client list.

Reinsurance Group of America represents another type of company, a life reinsurer, essentially an insurance company for life insurance companies. It helps the “direct writers” manage their own exposure to all types of mortality risk.

Here’s a look at what executives at the group life issuers, the individual life issuers and RGA are saying about death, drawn from the earnings call recordings.

Group Life Players

Dan Fishbein, president of Sun Life Financial’s Sun Life Financial U.S. unit: “In the U.S., our mortality moderated significantly, still elevated, but moderated significantly, throughout the year, and especially in certainly in the fourth quarter.”

Chris Swift, CEO of Hartford Financial: “Turning to group benefits, the core earnings margin of 8.3% for the quarter and 6.5% for the full year represents significant increases from last year as excess mortality has materially declined.

“With COVID shifting from pandemic, to endemic state, excess mortality losses are expected to improve versus 2022. However, we expect mortality trends will settle above pre-pandemic levels and we are pricing business accordingly.”

Ramy Tadros, president of MetLife’s U.S. business: “With respect to COVID, we see continued reduction in the number of deaths below 65, which also reduces the severity of any potential impacts from COVID.

“But, overall, you really should think about this moving to an endemic environment, one that we’ve priced for.”

Individual Life Players

Randal Freitag, Lincoln Financial´s chief financial officer:  “The life insurance business faced many challenges in 2022 and will continue to be pressured in 2023 by pandemic claims, higher reinsurance costs with some additional spread pressure.”

Robin Raju, Equitable’s CFO: “As you can see, looking back eight quarters, our experience is better than what we assumed in our … reserving.