Life insurance industry statistics 2024

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The life insurance industry sells products that promise future financial security, whether for the policyholder or their beneficiaries. Also known as the life and health (L&H) industry, the primary products available from these insurers are (1) life insurance, (2) annuities, and (3) accident/long-term care insurance. While the percentage of Americans who own life insurance products has dropped over the past several decades, the L&H industry continues to be profitable.

Key insights

The percentage of Americans who own life insurance policies fell from 76.7% in 1989 to 52% in 2022.

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Until 1985, traditional life insurance policies were the most popular product in the L&H industry. Sales of annuities passed life insurance in 1986 and now comprise 48.4% of the L&H market.

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The number of life insurance companies operating in the U.S. fell from 2,195 in 1990 to 727 in 2022.

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Worldwide, the life insurance industry is expected to see a compound annual growth rate of 1.66% through 2028, bringing the total value of written premiums to $3.92 trillion.

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General life insurance statistics

Ownership of life insurance policies in the U.S. has been on a downward trend over the past three decades, falling nearly 25% between 1989 and 2022.

During roughly this same time period, annuities overtook more traditional policies as the most popular form of life insurance. Life insurance and annuities are both insurance products designed to allow policyholders to put money away on a tax-deferred basis. Life insurance is designed to pay out when the policyholder dies, leaving money for their beneficiaries. Annuities allow for a guaranteed income stream in retirement, although they often also include a death benefit.

While annuities now make up nearly half of the overall life insurance market, 1986 was the first year when annuity premiums outpaced life insurance premiums.

How many life insurance companies are there

In 2022, there were fewer life insurance companies in the United States than at any point since the 1950s. The number peaked around 1990 when there were more than 2,000 life insurance companies.

According to the Insurance Information Institute, the following companies wrote the most life and annuity insurance coverage in the US in 2022.

Largest life insurers by direct premiums written in 2022

Source: Insurance Information Institute

Life insurance financial performance

In 2021, the life and health insurer sector of the insurance marketplace had $819 billion in direct premiums written. The amount of premiums written situates the L&H industry between the health insurance sector and the property and casualty insurance sector in terms of the dollar value of premiums written.

The value of direct premiums written in 2021 in the L&H sector represented 7% growth over the year prior, something analysts have partially attributed to the increased mortality rates experienced during the COVID-19 pandemic.

Life insurance market insights and overview

The U.S. life insurance market has experienced mixed trends in recent years. As noted above, the percentage of Americans with life insurance policies has been steadily declining over the past 35 years. The number of total life insurance policies in force has also been on the decline, decreasing by almost 23% between 2008 and 2022. The number of active life insurance policies has been below 300 million since 2010.

Nevertheless, companies in the L&H insurance industry continue to do well in terms of revenue and income. Total revenue in the industry grew nearly 14.5% between 2018 and 2022. And while net income grew at a slower pace over the same period, it remains up.

L&H industry revenue and net income (in billions)

Source: Insurance Information Institute

Life insurance future projections

Worldwide, the dollar value of gross written premiums continues to grow. The value in USD increased by 14.7% between 2017 and 2023, going from $3.08 trillion to $3.61 trillion. Gross written premiums are projected to show an annual growth rate of 1.66% through 2028.

Worldwide life insurance gross written premiums, projected to 2028 (in trillions USD)

Source: Statista

FAQ

Is life insurance declining?

The percentage of Americans with life insurance has declined steadily over the past 35 years. In 1989, 76.7% of Americans reported having life insurance; that number dropped to 52% in 2022.

How much life insurance does the average person have?

According to the American Council of Life Insurers, the average size of a newly purchased individual life insurance policy was $197,000 in 2022. That represents a 17% increase in the average policy size since 2012.

What are the most common types of life insurance?

The two most common types of life insurance policies are term life insurance and whole life insurance. Term life policies provide coverage for a set period of time and pay death benefits if the policyholder dies during that term. Whole life policies do not expire, provided that premiums are paid, until the death of the policyholder.


References

  1. Rudden, J. Number of life insurance companies in the U.S. 1950-2022. Statista. Evaluated Apr 2, 2024.Link Here
  2. “2023 Life Insurers Fact Book, Table 11.1.” American Council of Life Insurers. Evaluated Apr 3, 2024.Link Here
  3. “Facts & Statistics: Life Insurance.” Insurance Information Institute. Evaluated Apr 4, 2024.Link Here
  4. Hartley, D. “What Explains the Decline in Life Insurance Ownership?” Federal Reserve Bank of Chicago.Link Here
  5. “2023 Life Insurers Fact Book - Table 4.10.” American Council of Life Insurers. Evaluated Apr 3, 2024.Link Here
  6. Rudden, J. “Total number of life insurance policies in force in the United States from 2008 to 2022.” Statista Research. Evaluated Apr 3, 2024.Link Here
  7. Statista Market Insights. “Life Insurance Worldwide - Gross Written Premium.” Statista Research. Evaluated Apr 4, 2024.Link Here
  8. Federal Insurance Office. “Annual Report on the Insurance Industry (September 2022).” Department of the Treasury. Evaluated Apr 4, 2024.Link Here
  9. “2023 Life Insurers Fact Book, Chapter 7.” American Council of Life Insurers. Evaluated Apr 4, 2024.Link Here

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