U.S. Group Disability Market – accentuate the positive
May 21, 2012| By Drew King | Disability | English
Is there cause for optimism in the U.S. Group Disability Market? Figures from our latest U.S. Group Disability Market Survey, which covers around 95% of the marketplace, would seem to suggest so, with 2011 seeing some respectable albeit moderate gains.
Total combined sales premium grew by 2% in 2011, reaching close to $2 billion (a big improvement on last year’s decline of 12%). This was largely due to an impressive recovery in LTD new sales which rebounded from the double-digit decline seen in 2010 (-17%) to report 3% growth last year.
However, the growth rate for LTD in-force premium was flat, with STD in-force premium showing just 3% growth. In 2011, combined LTD and STD in-force premium totaled roughly $13.4 billion, only a small increase on 2010. Retention is key, and the good news is that more than 60% of carriers sold more LTD cases than they lapsed.
For Voluntary LTD, there was strong growth of 22% but this was driven by just a handful of carriers. Nevertheless, more than half of companies reported strong VLTD sales for 2011, with most showing increases in the double digits.
Competitive pricing among insurers, a lack of commitment on the part of employers and healthcare reforms stand in the way of growth. But some carriers have responded by refocusing their sales effort from larger cases to smaller employers, or vice versa, or simply relying on their existing block of business to help augment new sales.
Click here: U.S Group Disability Market, to find out more.