Life insurers look to various investments

Demand for various investments has been rising within the US life insurance coverage trade during the last yr and a half, in keeping with a report lately printed by ALIRT Insurance coverage Analysis.

Life insurers have been growing their investments in alternate options, which account for six.3% of complete invested property by the top of June 2023.

This improve in demand, ALIRT identified, reveals the trade’s want for larger yielding investments and its elevated consolation coping with the extra advanced investments, corresponding to personal fairness and hedge funds, that underly the broad asset class.

ALIRT, nonetheless, famous that whereas monetary markets remained unstable within the first half of this yr, insurers have continued so as to add to their holdings of different investments. It additionally predicted that demand for this asset class would stay even amid market volatility and better charges.

The insurance coverage analysis specialist additionally revealed that various investments have grown to 55% of the whole trade surplus by the top of this yr’s first half.

“As this asset class can exhibit higher volatility in comparison with extra ‘conventional’ investments, the life trade should stay cognizant of the risk-return stability of this asset class as mixture holdings proceed to rise,” ALIRT stated.

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