Life Insurers Face Steep Q1 Activity Drop: MIB
April 13, 2017 by Allison Bell
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MIB Group Inc. has detected what appears to be a sharp drop in U.S. individual life insurance application activity in the first quarter.
The Braintree, Massachusetts-based organization believes life application activity fell 4.5% in the first quarter.
Activity dropped 2.1% for consumers ages 60 and older; 4.3% for consumers younger than 45; and 6.4% for consumers ages 45 to 59.
The activity numbers for March looked worse than the numbers for January and February. In March, overall activity fell 6%. Activity for consumers ages 45 to 59 sank 8.4%.
Lee Oliphant, MIB’s president, said, in a video posted on the MIB website that the numbers may look worse simply because activity grew at a strong rate from 2014 through early 2016.
“We’ve really seen a strengthening of the index over the last five years,” Oliphant said.
MIB helps life insurers verify the information given in individual life insurance policies that go through some kind of underwriting process.
Life insurers can choose whether to submit applications through MIB. Any life insurer decisions to approve some applications without putting them through MIB verification could affect MIB activity results.
Some major U.S. life insurers have been going through realignments in recent months, and that could also affect activity.
People ages 45 to 52 are members of the “baby bust” generation, or the generation of people born from 1965 to 1980. The number of people born each year from 1965 through 1978 was much lower than the number born from 1946 and 1964. The relatively small number of U.S. resident who are now ages 45 to 52 could be contributing to the especially large drop in life application activity for people ages 45 to 59.
