US insurers report mortgage loans totalling $626.5bn, up 4% from 2019

Written by Adam Cadle

05/10/2021

Mortgage loans reported by US insurers at year-end 2020 totalled about $626.5bn in book/adjusted carrying value (BACV), representing a 4% increase from $602bn in BACV at year-end 2019, according to the National Association of Insurance Commissioners (NAIC).

The NAIC said mortgage loans were about 8% of total cash and invested assets at year-end 2020. Life insurance companies held the majority, or 96%, of the industry’s total mortgage loans, as “they match well with the longer-term nature of their liabilities”.

About one-quarter of US insurers’ exposure to mortgage loans was in multifamily/apartment properties. Furthermore, almost 90% of US insurers’ total mortgage loan exposure, or $557.6bn, was in commercial mortgage loans.

Life companies accounted for about 15% of the market’s commercial mortgage loans outstanding at year-end 2020, which was consistent with year-end 2019, according to the Mortgage Bankers Association (MBA). Commercial mortgage loan origination volume through Q1 2021 was down 14% versus Q1 2020 due in part to seasonality declines and COVID-19 pandemic economic effects.

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