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 accounts for 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 was primarily driven by indexed universal life (IUL) and variable universal life (VUL) products. IUL sales grew 11% to $959 million, with 75% of IUL carriers reporting growth. VUL new premium surged 41% year-over-year to $533 million, with approximately 70% of VUL carriers experiencing double- or triple-digit sales growth.
John Carroll, senior vice president and head of life and annuities at LIMRA and LOMA, attributed the growth to “increased availability of capital through private equity investment and reinsurance, coupled with advanced technologies and product innovation.” Karen Terry, corporate vice president and head of LIMRA Insurance Product Research, noted that carriers with strong sales growth pointed to demand for high face amount solutions and success in the middle market.
Product Performance
- Indexed Universal Life (IUL): $959 million in new premium, up 11% year-over-year. Policies sold rose 7%, with most carriers posting gains.
- Variable Universal Life (VUL): $533 million in new premium, up 41%. Policy count increased 6%.
- Whole Life: $1.48 billion in new premium, slightly higher than Q1 2024. Policies sold rose 2%, driven by final expense and small policy sales.
- Term Life: $738 million in new premium, down 1%. Policy count fell 2% year-over-year.
- Fixed Universal Life (Fixed UL): $235 million in new premium, down 4%. Policy count declined 13%.
Market Outlook
Despite economic concerns, LIMRA predicts continued growth for the life insurance industry in 2025. The organization projects life insurance premiums to reach $15.9 billion by the end of 2025, building on previous record levels. This growth is expected to be supported by strong equity markets and evolving product offerings.
However, the industry still faces challenges, with about 40% of Americans – equivalent to 100 million people – remaining uninsured or underinsured according to LIMRA’s barometer study. The COVID-19 pandemic has had a lasting impact on consumer behavior, heightening awareness of life insurance importance and driving significant growth in policy purchases in recent years.
As the market continues to evolve, industry experts are watching closely to see how these trends develop and how consumer behavior adapts to economic conditions.
