7 min read · Last updated August 5, 2026
- Whole life took 37% of new US individual life premium in 2025 and indexed universal life took 25%. Term took 17%, according to LIMRA.
- Indexed universal life premium grew 17% last year. Term premium grew 3%, and term policy count grew 2%.
- Derived from LIMRA’s own figures, indexed universal life added roughly $650 million of new premium in 2025 against term’s roughly $90 million, about seven times as much.
- The National Association of Insurance Commissioners tells buyers to settle how much coverage and for how long before choosing a policy type. A premium-matched quote reverses that order.
In this article
- What Simone was handed
- The 2025 mix, in one table
- Where the growth actually came from
- How to force a real comparison
- Frequently asked questions
Simone Whitfield is 38, has two children in elementary school, and asked an agent in April for enough life insurance to cover the mortgage and get both kids through college. She left the meeting with one illustration: $310 a month for a $400,000 indexed universal life policy, with a projected cash value column running down the right-hand side. She asked what $400,000 of 20-year term would cost. The answer came back nine days later at $34 a month.
What Simone was handed
Nothing in that meeting was improper. The illustration was accurate, the projections were labeled as projections, and indexed universal life is a legitimate product that does things term cannot. What happened to Simone is not misconduct. It is a default.
Look at what the American life insurance industry actually sold last year and the default becomes visible. LIMRA, the industry’s research association, reported that new annualized US individual life premium topped $17.5 billion in 2025, up 10% year over year and a record for four of the past five years. Inside that total, whole life premium reached $6.4 billion and represented 37% of the market. Indexed universal life reached a record $4.5 billion, or 25%. Term life came in at $3.1 billion, or 17%.
Add the four permanent categories together and permanent products account for 83% of new premium. That is the shape of the industry Simone walked into, and it is why the first illustration on the table was a permanent one.
The 2025 mix, in one table
LIMRA reports these figures line by line across separate paragraphs. Assembled in one place, the pattern is easier to read than any single number.
| Product | 2025 new premium | Change vs 2024 | Share of premium | Policy count change |
|---|---|---|---|---|
| Whole life | $6.4 billion | +7% | 37% | +12% |
| Indexed universal life | $4.5 billion | +17% | 25% | +8% |
| Term life | $3.1 billion | +3% | 17% | +2% |
| Variable universal life | $2.6 billion | +17% | 15% | +5% |
| Fixed universal life | $984 million | -4% | 6% | -6% |
| All individual life | $17.5 billion | +10% | 100% | +7% |
The column most people skip is the last one. Premium share tells you where the dollars went. Policy count tells you how many households bought. Whole life policy count grew 12% last year while term policy count grew 2%, so this is not simply a story about existing permanent buyers writing bigger checks.
Where the growth actually came from
Work backward from LIMRA’s own numbers and the gap sharpens. If indexed universal life finished 2025 at $4.5 billion after growing 17%, its 2024 base was about $3.85 billion, so it added roughly $650 million of new premium. Term finished at $3.1 billion after growing 3%, so its 2024 base was about $3.01 billion and it added roughly $90 million. Indexed universal life contributed close to seven times as much new premium growth as term did. These are our figures, derived from LIMRA’s reported premium and year-over-year change and rounded, not numbers LIMRA published.
That is the honest version of the claim, and it stops short of a motive. LIMRA attributes the indexed universal life growth to product and market conditions. Karen Terry, who heads LIMRA insurance research, said that “broader distribution, enhanced products and a strong equity market all contributed to the IUL growth in the fourth quarter and in 2025.” Broader distribution means more agents in more places able to sell it, which is a supply fact, not an accusation.
Our reading, and it is ours rather than LIMRA’s: when 83 cents of every new premium dollar goes to permanent products, the permanent illustration is the one already loaded and ready to print. A term quote is a thing you have to ask for. If the illustration in front of you is an indexed universal life policy, read our breakdown of how an indexed universal life illustration can lapse decades later before you sign it, and our piece on the whole life as investment myth for the cash-value math.
How to force a real comparison
The National Association of Insurance Commissioners, the standard-setting body for state insurance regulators, publishes a buying sequence that is the exact reverse of a premium-first quote. Its consumer guidance says to decide how much coverage you need first: “Based on the answers to these questions, decide how much coverage you need, for how long and what you can afford to pay.” Only after that does it turn to product type, where it notes that “term generally has lower premiums in the early years but does not build up cash values that you can use in the future,” and that permanent premiums “tend to be higher” because of the savings element.
So do it in that order. Name the face amount and the number of years before anyone shows you a product. Then require every quote at that same face amount and that same duration. Simone needed $400,000 for twenty years, which means the only fair comparison was $400,000 of twenty-year term against $400,000 of indexed universal life, and the answer to that question was $34 against $310.
That does not settle it. Permanent coverage that lasts past a term expiry is worth something real, and our guide to what happens when a term policy’s conversion window closes explains why the decision is not purely about price. But you cannot weigh a $276 monthly difference you were never shown. Ask for the term number in writing, at the same face amount, before the first meeting ends. If it takes nine days to arrive, that delay is information too. If you are still sorting out the categories, start with our overview of the main types of life insurance policies.
Frequently asked questions
Does a 37% whole life share mean most people buy whole life?
No. That is a share of premium dollars, not of policies sold. Permanent coverage costs far more per dollar of death benefit than term does, so a smaller number of permanent policies can account for a much larger share of premium. LIMRA reports premium shares and policy count changes as separate measures for exactly that reason.
Why did my agent lead with a permanent policy?
Often because it is the product most of the industry is selling. Permanent products took 83% of new individual life premium in 2025, and LIMRA credits broader distribution for part of the indexed universal life growth. That says more about what is easy to quote than about what fits your situation.
How do I compare a term quote against a permanent quote fairly?
Fix the face amount and the number of years first, then require every illustration at those same figures. Never compare on monthly premium, because equal payments buy very unequal amounts of death benefit. Ask for both quotes in writing on the same day.
Is permanent life insurance ever the right answer?
Yes, for needs that do not expire: a lifelong dependent, estate liquidity, a business buyout, or a final-expense obligation. The test is whether you need coverage after a term would end. If your need ends when the mortgage is paid and the children are grown, term matches the need.
Get a term quote at the same face amount before you decide
Compare 20-year term pricing on a fixed death benefit across carriers, so the permanent illustration has something honest to sit next to.
