Lapse rates of ordinary life products near two-decade low: A.M. Best
July 11, 2016 by Editorial Staff
The last two years have seen the highest persistency rates in nearly 20 years, around 86%, according to a new A.M. Best report.
Running between 5.3% and 5.9% in the years 2012 to 2015, lapse rates on ordinary life insurance products have fallen to their lowest level in nearly two decades, according to a new A.M. Best report.
The Best Special Report, titled, “Anemic Yields Put Spotlight on Retention,” asserts that ordinary life persistency has been relatively steady, fluctuating between 81.1% and 86.5% in 1997-2015. The trend appears to be somewhat correlated to the U.S. unemployment rate. The last two years have seen the highest persistency rates in nearly 20 years, around 86%.
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