Economic factors continue to influence employees’ enrollment decisions. According to a recent LIMRA consumer survey, more than half of workers cite inflation and a potential recession as having at least some impact on their enrollment decisions.
“While COVID-19 is playing less of a role, it still has an influence on enrollment decisions, especially when it comes to certain products such as life insurance and supplemental health products,” said Patrick Leary, corporate vice president and director of LIMRA’s workplace benefits research program. “During the pandemic, employees became much more aware of the need for insurance and related protection products, and that trend continues, although to a lesser extent.”
Supplemental Health Insurance
In the fourth quarter, U.S. workplace supplemental health product sales—accident, critical illness, cancer, hospital indemnity, and other supplemental health insurance products*—totaled $708 million in new premium, an eight percent increase year-over-year. In 2022, workplace supplemental health insurance product sales were $2.9 billion in new premium, up 12 percent from 2021 results.
The 2022 sales growth was driven by exceptionally strong results in the first quarter of 2022, when total supplemental health new premium increased 17 percent. In the following three quarters of the year supplemental health premium sales continued to grow, albeit at a slower pace.
All supplemental health product lines recorded growth in the fourth quarter: Accident insurance grew nine percent, critical illness climbed 12 percent, cancer insurance improved nine percent, and hospital indemnity experienced 10 percent growth.
Disability Insurance
Total workplace disability insurance new premium sales was $1 billion in the fourth quarter 2022, a year-over-year 25 percent increase. Long-term disability insurance new premium increased 21 percent in the fourth quarter and 13 percent for the year. Short-term disability new premium was up 28 percent for the quarter and four percent for the year.
Overall, U.S. workplace disability new premium totaled $3.9 billion in 2022, a year-over-year increase of eight percent.
Life Insurance
In the fourth quarter 2022, total workplace life insurance new premium was $837 million, down nine percent from prior year results. For the year, U.S. workplace life insurance new premium totaled $3.9 billion, down one percent from 2021.
“After the 14 percent increase in workplace life insurance premium in 2021—one of the largest increases recorded over the past 30 years—workplace life insurance premium normalized in 2022,” Leary said.
LIMRA’s workplace benefits sales surveys for life insurance, disability insurance and supplemental health represent at least 90 percent of their respective annualized premium markets.
You can find the latest data table with U.S. workplace sales trends in LIMRA’s Fact Tank, https://www.limra.com/en/newsroom/fact-tank/.
*“Other supplemental health products” represents products that do not fit the other categories, such as gap insurance, minimum essential coverage plans, limited benefit medical, and heart/stroke products.
Serving the industry since 1916, LIMRA offers industry knowledge, insights, connections, and solutions to help more than 700 financial services member organizations navigate change with confidence. Visit LIMRA at https://www.limra.com.
