Overview
In the first quarter of 2025, U.S. individual life insurance new annualized premium reached $3.94 bn, reflecting an 8% increase from the same period in 2024, according to LIMRA report.
The total number of life insurance policies sold rose by 1% year-over-year. LIMRA attributed this growth to increased demand for indexed and variable universal life insurance products.
John Carroll, senior vice president and head of life and annuities at LIMRA and LOMA, noted that ongoing inflation and equity market volatility contributed to heightened interest in permanent life insurance (see Life Insurers’ Investment Risks).
He added that the combination of greater private equity investment, reinsurance capacity, advanced technology, and product innovation is expected to support continued expansion in the life insurance sector throughout 2025.
Persistent inflation and higher equity market volatility drove interest in permanent life insurance. Amid the increased availability of capital through private equity investment and reinsurance, coupled with advanced technologies and product innovation, LIMRA predicts continued growth for the life insurance industry in 2025.
John Carroll, senior vice president and head of life and annuities at LIMRA and LOMA
U.S. Life Insurance New Annualized Premium
U.S. final expense life insurance new annualized premium increased 16% year over year to $1.05 bn in 2024, according to LIMRA-Life Insurers Council (LIC) Survey Report.
The study examines sales data reported by 28 life insurance companies, including policy size, premium and policy count, and breakdowns by underwriting category, policy type, reinsurance and distribution channel.
In 2024, survey participants reported 1.06 mn policies sold, up 10% year over year. Nearly 6 in 10 companies surveyed reported greater than 10% sales growth year over year, and over a third experienced sales more than 25% above their sales in 2023.
Overall, the study reveals solid results for most of the participating companies, but the year was not without its challenges for others. The performance variability observed in 2023 continued in 2024
Dean Lambert, executive director, LIC
“Final expense addresses the insurance needs of some of America’s most vulnerable and underserved people — low-income seniors — and LIC is proud to serve as a resource to help carriers succeed in the final expense marketplace.”
Sales Expectations for 2025 are Generally Optimistic
Three quarters of participating carriers expect some growth across the industry, and nearly half expect a significant increase for their company.
Most of the sales reported (85%) were simplified-issue policies with an average face amount of $14,535. The remaining 15% were guaranteed-issue policies with an average face amount of $9,786.
The survey shows independent distribution is the predominant sales channel for final expense products, selling 86% of the policies reported in 2024.
Affiliated distribution sold 10% of the final expense policies, and 4% of policies were sold through direct-to-consumer channels, according to U.S. Life Insurance Premium and Annuity Sales Growth Trends.
The LIMRA-LIC Final Expense Survey is not a comprehensive view of the U.S. final expense market, but offers a snapshot of sales trends for participating companies.
Product-Specific Performance in the Life Insurance Market
Indexed universal life (IUL) premium grew 11% year-over-year, reaching $959 mn in Q1. Roughly 75% of carriers selling IUL products reported gains, and half posted double-digit increases.
Policy count rose 7% in the quarter, with IUL accounting for 24% of total new annualized premium. Variable universal life (VUL) products recorded even stronger performance, with new premium increasing 41% to $533 mn.
The number of VUL policies sold grew by 6%, and 70% of carriers reported double- or triple-digit gains. VUL held 14% of total life insurance premium for the period.
Whole life (WL) premium stood at $1.48 bn, slightly higher than the previous year. Sales were supported by growth in final expense and smaller policies, leading to a 2% increase in policy count. WL represented 37% of new annualized premium.
Term and Fixed Universal Life Insurance Trends
Term life insurance, which accounted for 19% of the U.S. life insurance market in Q1, declined 1% in premium to $738 mn. Policy count dropped 2%, with more than half of insurers reporting declines.
Karen Terry, corporate vice president and head of LIMRA insurance product research, noted that term products primarily serve middle-income and younger adults, who remain more sensitive to inflation and economic uncertainty—factors that historically suppress demand for these offerings.
The very consumers who are most affected by heightened inflation and increased economic uncertainty — often middle-income and younger adults — are the target market for term products
Karen Terry, corporate vice president and head of LIMRA insurance product research
“Historically, weaker economic conditions and recessions often depress sales of these products,” Karen Terry said.
Fixed universal life (FUL) recorded a 4% decrease in premium to $235 mn, its lowest result since Q3 2023. The number of FUL policies sold fell 13% compared to the prior year. FUL made up 6% of new annualized premium during the first three months of 2025.
For full-year 2024, total new annualized premium rose 4% to $16.2 bn, marking the fourth straight year of record-high premium volumes.
Policy counts remained flat compared to 2023. In Q4 2024 alone, new premium climbed 14% to $4.6 bn and policy sales grew 2% from Q4 2023.
Total US Pension Risk Transfer Sales
Total U.S. pension risk transfer (PRT) new premium reached $7.1 bn in the first quarter of 2025, down 51% from the record set in the same period last year.
This figure still marked a 10% increase over the first quarter of 2023, based on data from LIMRA’s U.S. Group Annuity Risk Transfer Sales Survey.
The market recorded 127 contracts during the quarter, reflecting a 13% decline from the prior year. These contracts covered close to 100,000 pension participants.
Since 2020, more than 3.1 mn participants have been included in U.S. PRT deals.
Trends in Buy-Outs and Buy-Ins
Single-premium buy-out sales totaled $7 bn in the first quarter, representing a 51% year-over-year decline. The 125 buy-out contracts sold were also 13% fewer than the previous year.
Single-premium buy-in activity remained limited, with only two contracts reported for a total of $141.6 mn, down 67% from the same period in 2023.
Despite the drop in new premium volume, asset growth continued. Single-premium buy-out assets reached $301.1 bn, a 10% increase from the prior year.
Buy-in assets rose to $7 bn, up 9% from the first quarter of 2023. Combined, single premium assets grew to $308.3 bn, up 10% year over year.
Market Outlook and Plan Sponsor Activity
Keith Golembiewski, assistant vice president and head of LIMRA Annuity Research, noted that retiree-only carve-outs accounted for 57% of Q1 sales.
He emphasized that while large transactions may vary each quarter, interest from small and mid-sized plan sponsors in PRT solutions remained steady.
Although larger plan deals fluctuate quarter to quarter, smaller and mid-sized plan sponsor interest in PRT solutions remained strong in the first quarter.
“While current heightened economic uncertainty may initially dampen growth in the PRT market this year, LIMRA expects the expanded PRT market capacity combined with plan sponsor interest will ultimately propel strong PRT sales throughout 2025,” said Keith Golembiewski.
Although ongoing economic uncertainty could limit growth in the short term, Golembiewski expects that increasing market capacity and sustained demand from sponsors will drive strong PRT activity into 2025.
PRT products, including pension buy-outs, allow employers to shift pension liabilities to insurers. This strategy reduces balance sheet exposure and helps manage funded status volatility.
FAQ
New annualized premium hit $3.94 bn in Q1 2025, up 8% from Q1 2024. Growth came from higher demand for indexed and variable universal life products, driven by inflation and market volatility.
Indexed universal life rose 11% to $959 mn, with a 7% increase in policies. VUL surged 41% to $533 mn. Whole life hit $1.48 bn, up slightly with a 2% rise in policies. Term life dropped 1% to $738 mn, and fixed UL fell 4% to $235 mn.
Final expense premium rose 16% to $1.05 bn, with 1.06 mn policies sold (up 10%). Most were simplified-issue. Independent agents sold 86% of policies. Most insurers expect growth to continue in 2025.
Total new annualized premium was $16.2 bn, up 4% for the year — a record high for the fourth year in a row. Q4 premium grew 14%, with a 2% rise in policy count.
PRT sales totaled $7.1 bn, down 51% from Q1 2024 but up 10% from Q1 2023. There were 127 contracts, covering about 100,000 participants.
Buy-outs hit $7 bn (down 51%) across 125 contracts. Only two buy-ins were sold, totaling $141.6 mn (down 67%). Still, assets grew: buy-out assets rose to $301.1 bn, buy-in assets hit $7 bn.
LIMRA expects strong demand from smaller plan sponsors to keep driving the market. Retiree carve-outs made up 57% of Q1 sales. More capital and reinsurance capacity should support steady growth through 2025.
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AUTHORS: John Carroll – senior vice president and head of life and annuities at LIMRA and LOMA, Dean Lambert – executive director, LIC, Keith Golembiewski – assistant vice president and head of LIMRA Annuity Research
