Gen Re has published findings from its annual US Individual Disability Market Survey, which benchmarks performance across non-cancelable (Non-Can), guaranteed renewable (GR), buy-sell, and guaranteed standard issue (GSI) product lines for the years 2023 and 2024.
Total new premium sales for Non-Can, GR, and buy-sell products declined by 1.7% in 2024 to US$478.9 million. Within that figure, Non-Can made up US$407.9 million, or 85%, while GR represented US$68.9 million, or 14%. Buy-sell accounted for less than 1% of new premium and policies but represented 32% of total new benefit amounts for the year.
The number of new policies issued rose 4% to over 283,000. However, the total benefit amount fell 9% to US$1.5 billion compared to the prior year.
In 2023, the individual disability insurance market recorded a 7% increase in total new premium sales, totaling US$490 million. That growth came on the heels of a recovery period following the disruptions caused by the COVID-19 pandemic. The momentum carried over from 2022, suggesting a renewed interest in disability coverage.
However, the latest figures for 2024 indicate a slight contraction, possibly signaling a normalization after two years of above-average growth in the sector.
In-force premium across the Non-Can, GR, and buy-sell segments increased 3.2% in 2024 to US$5.5 billion. Non-Can and GR segments each rose 3% over 2023, while buy-sell in-force premium dropped 5%.
Of the US$5.5 billion total, Non-Can accounted for US$4.7 billion, GR for US$776.9 million, and Buy-Sell for approximately US$45 million. The total number of inforce policies remained stable at 3.1 million, with benefit amounts also largely unchanged, increasing less than 1% to US$19.7 billion.
For the GSI market, combined Non-Can and GR new sales premium reached US$80.5 million in 2024, up 22.4% from the prior year. Nearly 99% of that total came from Non-Can products, which rose from US$65 million in 2023 to over US$79 million. GSI inforce premium increased 9.5% to almost US$504 million.
Employer-paid policies represented US$47.8 million, or 59% of new GSI premium, while employee-paid policies made up US$32.8 million. Within the total GSI inforce premium, employer-paid policies contributed US$204.2 million and employee-paid accounted for US$299.8 million, maintaining the 59% share.
Demographic shifts continue to influence the disability insurance market, particularly as the US population ages. Older individuals, who face a higher likelihood of illness or injury that may prevent them from working, have shown increased interest in purchasing disability coverage.
Mental health-related disability claims have drawn more attention in recent years. Conditions such as anxiety, depression, and stress-related disorders are increasingly cited as contributing to work limitations.
However, insurers continue to face challenges in evaluating these claims, as the subjective nature of mental health assessments can result in higher denial rates compared to claims based on physical injuries or illnesses.
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