BBB-rated Bond Exposure for Life Insurers
Life insurers significantly increased their holdings of NAIC Class 2 bonds (bonds with BBB/Baa ratings public rating agencies) in the years since the financial crisis of 2008-2009.
Prudential Agrees to Reinsure block of Guaranteed Universal Life Insurance with Somerset Re
Prudential Financial, Inc. (PRU) announced this week that it had entered into a reinsurance agreement to cede a $12.5 billion block of guaranteed universal life insurance business (GUL) to Bermuda based Somerset Reinsurance Ltd. (Somerset Re). This is the second substantial reinsurance arrangement announced by PRU over the last few months.
Mortality for the Life Insurance Industry in 2022
In this review we highlight the increase in mortality and its continued impact on the U.S. life insurance industry.
ALIRT Industry Update: U.S. Life Review Three Months 2023
Our three month 2023 financial highlights based on insurers’ statutory financial statements.
ALIRT Industry Update: U.S. PC Review Three Months 2023
Below we provide first quarter 2023 financial highlights for the ALIRT P&C Composite1, based on insurers’ statutory financial statements.
No Surprise – Hallmark Insurer Subsidiaries Downgraded
As if on cue, last Friday (May 5th) A.M. Best downgraded the Hallmark Financial subsidiaries below the critical “A-” level to “B++” (5th highest), citing a “significant decline in Hallmark’s balance sheet strength and operating performance due to continued adverse development in the group’s retained discontinued commercial auto lines.”
Lincoln National Reinsures $28 Billion of Reserves to Fortitude Re
On May 2, 2023, Lincoln National Corp. announced that it had entered into a reinsurance transaction with
Fortitude Reinsurance Company, Ltd. (Fortitude Re), a Bermuda domiciled reinsurer. The transaction comprises $28 billion of reserves (on a statutory accounting basis) and encompasses several blocks of business held by LNC’s life insurance subsidiaries which include:
U.S. Life Insurer Exposure to Less Liquid Bonds
Life insurers have long held a mix of assets with various liquidity profiles, from the very liquid to the
nearly illiquid. Investments with the highest liquidity include investment grade bonds (especially
government bonds), securities with a short remaining duration, and cash and cash equivalents. Less liquid securities include mortgage loans, below investment grade bonds, and alternative investments.
Mortgage Loan Exposure for Life Insurers
Mortgage loans have long been one of the most important asset classes for life insurers. Life insurers do not have substantial direct investments in real estate, but they do participate in real estate investing by loaning money directly to property owners or real estate developers……
ALIRT Industry Update: U.S. Health Review Year-End 2022
Our year end 2022 financial highlights based on insurers’ statutory financial statements.