How the Downturn Will Affect the Insurance Consumer
The financial challenges encountered by the insurance industry throughout the business downturn have been widely reported. As the downward pressure eases, changes in insurance products are starting to emerge.
As one indicator, it appears that a long historical decline in the price of term life insurance policies has ended. My colleague at Longevity Alliance, Bruce Cassens, who has years of experience in the life insurance industry, reports to me that term life insurance premiums have gone up from five to fifteen percent depending upon the carrier. Bruce also tells me that prices are rising on permanent, universal and whole life.
This trend reflects industry pressure to regain a solid financial footing coming out of the recession. It comes at a time when people who are “aging out” of old term policies may find they need life insurance for longer than they originally expected and therefore may need to go back into the market. For example, they may need to keep working for longer than originally planned or they may have continuing financial concerns for children or grandchildren.
A variety of factors will lead to increased demand for long term care insurance, life insurance and lifetime payout annuities. Insurance products are more important now to consumers than they have been in a long time. Competing pressures will make for interesting developments throughout the industry.
Steve,
I found this interesting.
I wanted to point out that I believe the title should read “How the DowntURN Will Affect the Insurance Consumer”
Not “Downtown”
I believe you may know my father, Mark Rosenberg, he mentioned you have a connection to Norvax. I will be joining them at the beginning of next month. I look forward to learning about this industry, i’ll have to keep up on your blog posts.
Thanks,
Eli Rosenberg
A bit off-topic but I use Norvax and they are a fine company. A lot of Miami University grads there like myself.
And I also agree that long term care insurance products will become even more popular this decade.