Total U.S. sales of workplace disability insurance premiums reached $1.7 billion in the first quarter of 2023 — a year-over-year increase of five per cent — driven by a 17 per cent increase in short-term disability insurance sales, according to a new report by LIMRA.
It also found sales of long-term disability insurance premiums were down five per cent, while voluntary long-term disability sales were down 15 per cent. Total workplace life insurance premiums also reached $1.7 billion in the first quarter, a year-over-year decrease of two per cent. Term products were also down three per cent, driven in large part by a decline in voluntary sales. Conversely, permanent products were up seven per cent, driven by a 23 per cent increase in whole life products.
“The decline in sales this quarter was largely influenced by two of the top workplace life insurance carriers,” said Patrick Leary, LIMRA’s vice-president and director of workplace benefits research, in a press release. “Combined, these two companies posted a decline of 55 per cent versus a combined increase of 14 per cent for all the other companies in the survey.”
Sales of U.S. workplace supplemental health products ― including accident, critical illness, cancer and hospital indemnity ― totalled nearly $1.2 billion in new annualized premiums, a two per cent decline year over year. Losses in total supplemental health premiums were primarily attributed to a drop in new critical illness sales, which declined eight per cent.
“This is the first time since 2020 that workplace critical illness has not shown quarterly growth, while all other major product lines have shown quarterly growth since the second quarter of 2021,” noted Leary.