US insurers’ common stock exposure declines

Written by Adam Cadle

30/11/2023

US insurers’ total exposure to common stock decreased from around $1.2trn at year-end 2021 to $1trn at year-end 2022, latest figures published by the NAIC have shown.

The NAIC said the US inflation reaching a 40-year high in mid-2022 was partly behind this, as well as geopolitical tensions resulting from the war between Russia and Ukraine creating volatile financial markets. Tensions between the US and China were also listed as a reason.

Due mainly to the decrease in market valuation, total common stock was about 12.5% of US insurers’ total cash and invested assets at year-end 2022, down from 14.6% at year-end 2021.

P&C companies accounted for the largest exposure at 77% of the total, followed by life companies at 20%.

Unaffiliated common stock totalled $505.8bn in 2022, a 10% decrease from about $568bn at year-end 2021; unaffiliated publicly traded common stock totalled $492bn in 2022, down from $553bn at year-end 2021.

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