Insurers Taking On Less Investment Risk

Today's unusual set of economic circumstances provides a challenging backdrop for insurers to invest their money prudently.

Interest rates have fallen to 45-year lows, the equity market is still recovering from post-bubble adjustments, there is a threat of deflation in the air, and high-quality intermediate bonds offer negative real yields. As a result, insurers have been revising their business strategies, raising premium levels, containing costs and accumulating cash.

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