New Eastbridge research shows employers and employees continue to keep voluntary benefits coverage

AVON, CONNECTICUT, USA (April 9, 2025)

Carriers’ ability to track lapse rates varies widely

Voluntary carriers report stable persistency in their voluntary business over the last four years despite inflation and other economic pressures, according to a new study from Eastbridge Consulting Group. Eastbridge’s Voluntary Lapse Rates Spotlight™ Report shows average first-year lapse rates are virtually unchanged at both the account and employee levels now compared to a similar study in 2021.

“Sales are important, but keeping that business also is critical for carriers’ long-term success,” said Ginger Bates, Eastbridge director of research. “These stable lapse rates appear to indicate employers and their employees continue to see value in the protection voluntary benefits provide.”

The Voluntary Lapse Rates Spotlight™ Report compiles data on information carriers track related to voluntary lapse rates and provides benchmarks on results at the account and employee levels. The report covers topics including account-level lapse rates by year and case size, reasons why accounts lapse, how lapse results compare to pricing expectations, employee-level lapse rates by group and individual products, five-year lapse rates for supplemental health products (accident, critical illness and hospital indemnity), trends in account-level and employee-level lapses, carriers’ concerns for the future and changes carriers anticipate making to improve lapse rates.

Other key findings in the report include:

• Voluntary carriers are mixed in their ability to track the amount of their business they keep and the reasons why coverage lapses. Few carriers track lapse rates at the employee level or by group size, and many lack this data by product.
• Universal life and whole life insurance have the lowest employee-level lapse rates.
• Voluntary carriers are concerned about the impact of heaped commissions and takeovers on account retention.