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Life Health > Annuities

U.S. Deaths Still 7% Over Pre-COVID Norm in Q2

By Allison Bell

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What You Need to Know

  • General-population mortality trends may differ from trends for people with life insurance and annuities.
  • The total number of first-half deaths was about 110,000 higher than the first six months of 2019.
  • One group would like to see life insurers use voluntary screening tests to learn more about mortality trends.

The U.S. Centers for Disease Control and Prevention has bad news for financial advisors who want to build life expectancy into clients’ life insurance and retirement income planning: The U.S. death rate is still running high.

The CDC recorded 728,343 deaths from all causes for the 13-week period ending June 29, according to preliminary death data it publishes along with its weekly influenza tracking reports.

That was 0.8% lower than the number of deaths recorded in the second quarter of 2023, but it was 7% higher than the number of deaths recorded in the second quarter of 2019, before the COVID-19 pandemic began.

The second-quarter death count was about 48,000 higher than the number recorded during the comparable period in 2019.

For the first half of 2024, the number of deaths was 7.7% higher than in the first half of 2019, and that total number of deaths was 110,000 higher than in the comparable period in 2019.

What it means: Financial advisors may have to prepare clients for the possibility that life expectancy could be more difficult to predict than it used to be.

In some cases, for example, advisors and tax planners use mortality tables approved by the Internal Revenue Service to perform calculations that limit the amount of tax benefits a client can use in a given year. The required tables may reflect overly optimistic thinking about how long clients will live.

The history: Before about 2015, U.S. life expectancy usually improved every year.

After 2017, opioid use and other problems caused mortality improvement to stall.

Starting in 2020, the COVID pandemic caused three years of sharp increases in the U.S. death rate.

The death rate fell sharply in 2023 but has continued to hover over pre-COVID levels.

Reasons: The CDC is collecting and reporting much less rapid mortality data than it was during the period officially declared to be the pandemic emergency period. Details about most causes of death are not yet available for the current year.

The CDC attributed only about 26,000 of the 110,000 extra deaths that occurred in the first half of the year to COVID.

Some of the other factors that could be causing the stubbornly high mortality rates could include fatal cases of acute COVID that were left off death certificates; long COVID; other upper respiratory illnesses, such as influenza; the effects of COVID on the health care system; the effects of preventive care and routine sick care that people skipped during the worst months of the pandemic; and any harm done by efforts to prevent and treat COVID.

Still another possibility is that states are getting more complete death data to the CDC earlier than in 2019. If that’s the case, the apparent increase in the death count could be due to changes in data reporting rather than underlying changes in mortality.

Demographics: Even if the increase in mortality showing up in the preliminary CDC death data is real, changes in mortality for the general population may not correlate with mortality trends for people with life insurance and annuities.

Some life insurers have said that they believe that the death rate for people with life insurance and annuities is now comparable to that it was before the pandemic began. Others, including an executive from Globe Life, have said that they see death rates that are within the range they assumed in forecasts but are higher than before the pandemic began.

One group, Insurance Collaboration to Save Lives, has suggested that insurers consider offering insureds extra screening tests in an effort to determine why mortality is still higher than it was before 2020.

Credit: Shutterstock

Allison Bell

Think_Allison

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