The US individual life insurance market saw an 8% year-over-year increase in new annualized premium to $3.94 billion in the first quarter of 2025, according to LIMRA’s US Life Insurance Sales Survey. The survey, which covers 80% of the US life insurance market, also reported a 1% increase in the number of policies sold compared to the same period in 2024.
Key Drivers of Growth
The growth in life insurance sales was primarily driven by indexed universal life (IUL) and variable universal life (VUL) products. IUL new premium grew 11% to $959 million, with 75% of IUL carriers reporting growth. VUL new premium saw a significant 41% year-over-year increase to $533 million, with approximately 70% of VUL carriers experiencing double- or triple-digit sales growth.
Product Performance
- Indexed Universal Life (IUL): IUL premiums made up 24% of total new annualized premium for the quarter. The number of IUL policies sold rose 7% year over year, with most carriers posting gains.
- Variable Universal Life (VUL): VUL premiums represented 14% of the US life insurance market’s total in the first quarter. The number of VUL policies sold increased 6% from the first quarter of 2024.
- Whole Life: Whole life new premium reached $1.48 billion, slightly higher than the same period in 2024. The number of whole life policies sold rose 2%, supported by an increase in final expense and small policy sales. Whole life accounted for 37% of total new annualized premium sold during the quarter.
- Term Life: Term life new premium declined 1% to $738 million, with over half of carriers reporting a decrease. Policy count fell 2% year over year. Term life made up 19% of the U.S. individual life insurance market in the first quarter.
- Fixed Universal Life (Fixed UL): Fixed UL new premium dropped 4% to $235 million, marking the lowest quarterly premium collected for this product line since the third quarter of 2023. The number of fixed UL policies sold declined 13% compared to the first quarter of 2024.
Market Context and Future Outlook
Despite economic concerns, LIMRA predicts continued growth for the life insurance industry in 2025, driven by increased capital availability through private equity investment and reinsurance, along with advancements in technology and product innovation. The pandemic has heightened awareness of the importance of life insurance coverage, contributing to ongoing demand. LIMRA projects that life insurance premiums will reach $15.9 billion by the end of 2025.
However, a significant portion of the US population remains uninsured or underinsured. According to LIMRA’s barometer study, about 40% of Americans, equivalent to 100 million people, lack sufficient coverage.
