The 2018 U.S. Group Disability Market Survey covers employer-paid and employee-paid short-term disability and long-term disability insurance products, and includes an analysis of premiums, cases, and covered lives from new sales and in-force business in 2017 and 2018. In total, 25 disability insurance companies contributed to the 2018 survey. Milliman’s Jennifer Fleck and Paul Correia provide more perspective in this paper.
The overall spending on life and disability benefits is significantly less than the costs for healthcare coverage. But a little focus there can often lead to real savings on these products along with greater employee satisfaction.
Benefits managers don’t have to wait until a renewal at the end of a rate guarantee to review the program’s experience. Performing reviews on an annual basis can ensure that there are no surprises.
Benefits managers should consider rate comparisons, quality of service received, and integrated leave management options as well as disability and life insurance specific considerations.
In this article, Milliman’s Jennifer Fleck discusses in more detail what employers should consider when group disability and life insurance benefits come up for renewal.
The disability trust fund is now expected to be depleted in 2032 instead of 2028. This is primarily due to the assumption of lower disability applications and other underlying assumption changes since last year.
According to projections, assuming no legislative changes, only 83% of disability income benefits would be payable after the trust fund is depleted. The projection also shows that the trust fund balance begins to fall in 2019. That means that starting next year, the total cost of the disability income program exceeds the total income on the program, including interest.
Cutting benefits could have substantial impacts to group insurers that would likely need to increase claim reserves for future benefit payments on their policies. Lower Social Security Disability Insurance (SSDI) benefits would mean lower benefit offsets and thus higher long-term disability benefit payments.
It is important that actuaries working with group disability insurance pay attention to changes in the SSDI program which could affect their financial results. Milliman consultant Jennifer Fleck provides some perspective in her article “Social Security disability actuarial status, 2018.”
Milliman recently released the results of its 2017 U.S. Group Disability Market Survey, a comprehensive report that analyzes the short- and long-term disability (STD/LTD) market, including sales and in-force business.
In total, 25 disability insurers representing over 90% of the market contributed data to the survey, which provides analysis of premiums, cases, and covered lives in 2016 and 2017 for all participating companies. The report ranks participating companies by both STD and LTD in-force premium and new sales totals, and offers insight into current trends in the group disability market.
We’re continuing to see strong growth in the marketplace despite consolidation among U.S. group disability insurers. And while the market consolidation may have played a factor in poorer performance for some insurers in 2017 compared to previous years, overall new sales for STD and LTD markets are up by a combined 7.3%.
Survey highlights include:
• Combined STD and LTD in-force premium for participants was approximately $16.7 billion in 2017 compared with $16.0 billion in 2016.
• STD new sales premiums saw an 8.5% increase from 2016 to 2017, while LTD new sales premiums increased by 6.6%.
• Unum, Lincoln Financial Group, and Cigna retained the top three spots for new STD sales premium in 2017. Unum, The Hartford, and MetLife took the top three spots for new LTD sales premium.
• Average STD premium per life increased by 0.9% for in-force business, and by 2.0% for new sales; average LTD premium per life increased by 2.7% for in-force business and by 3.3% for new sales.
Copies of the full report are only available to participating companies. For a summary of results, click here.
The 2016 U.S. Group Disability Market Survey covers employer-paid and employee-paid short-term disability and long-term disability insurance products and includes an analysis of premiums, cases, and covered lives from new sales and in-force business in 2015 and 2016. Twenty disability insurance companies contributed to the 2016 survey. Milliman consultants Paul Correia and Jennifer Fleck offer some perspective.
Milliman and Gen Re, a leading global life/health reinsurer, are pleased to announce results from their first jointly produced U.S. Group Disability Market Survey.
The U.S. Group Disability Market Survey, originally launched in 1987, has returned after a brief hiatus as a result of a collaborative partnership between Milliman and Gen Re. The report covers sales and in-force results for short-term disability (STD) and long-term disability (LTD) products and includes analysis of premiums, cases, and covered lives from new sales and in-force business for 2014 and 2015.
Highlights from the survey include:
• Total premium was approximately $4 billion for total STD in-force business and $10 billion in 2015 for LTD in-force. This is believed to represent 90% to 95% of the group disability insurance market, with 26 disability insurance companies participating.
• Combined STD and LTD in-force premium was about $14.7 billion among contributing companies, versus $14.1 billion in 2014. STD in-force premium increased by approximately 6% from 2014 to 2015, and LTD in-force premium increased by approximately 3%.
• Combined new sales premium (STD and LTD) was approximately $2.1 billion for 2015 versus $2.0 billion in 2014. STD new sales premium increased by approximately 8% from 2014 to 2015, and LTD new sales premium increased by approximately 2%.
Copies of the full report will be available only to participating companies. For a summary of results, click here.