Property/Casualty Industry Investments

Cash and invested assets of property/casualty insurance companies totaled $1.53 trillion in 2014. This represents 88 percent of total assets, which were $1.74 trillion. Most of these assets were invested in highly liquid securities (high-quality stocks and bonds, for example, rather than real estate), which can be sold quickly to pay claims in the event of a major catastrophe.

 

Investments, Property/Casualty Insurers, 2013-2015 (1)

($ millions, end of year)

  Amount Percent of total investments
Investment type 2013 2014 2015 2013 2014 2015
Bonds $927,346 $941,943 $949,702 62.47% 61.45% 62.01%
Stocks 329,642 345,762 340,252 22.21 22.56 22.22
     Preferred 11,550 14,630 14,025 0.78 0.95 0.92
     Common 318,092 331,133 326,227 21.43 21.60 21.30
Mortgage loans on real estate 7,972 10,008 12,441 0.54 0.65 0.81
     First liens 7,765 9,820 12,209 0.52 0.64 0.80
     Other than first liens 207 188 232 0.01 0.01 0.02
Real estate 9,975 10,165 11,685 0.67 0.66 0.76
     Properties occupied by company 8,484 8,598 8,716 0.57 0.56 0.57
     Properties held for income production 1,249 1,286 2,693 0.08 0.08 0.18
     Properties held for sale 243 282 276 0.02 0.02 0.02
Cash, cash equivalent and short-term investments 83,645 90,754 87,516 5.63 5.92 5.71
Derivatives 578 637 652 0.04 0.04 0.04
Other invested assets 118,344 126,582 121,291 7.97 8.26 7.92
Receivable for securities 1,494 1,104 2,530 0.10 0.07 0.17
Securities lending reinvested collateral assets 2,746 2,681 2,618 0.18 0.17 0.17
Aggregate write-in for invested assets 2,776 3,282 2,860 0.19 0.21 0.19
Total cash and invested assets $1,484,518 $1,532,917 $1,531,547 100.00% 100.00% 100.00%

(1) Includes cash and net admitted assets of property/casualty insurers.

Source: NAIC data, sourced from S&P Global Market Intelligence, Insurance Information Institute.

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BONDS

Property/casualty insurers invest primarily in safe, liquid securities, mainly bonds. These provide stability against underwriting results, which can vary considerably from year to year. The vast majority of bonds are government-issued or are high-grade corporates. Bonds in or near default accounted for less than 1 percent (0.13 percent) of all short- and long-term bonds owned by insurers at the end of 2014, according to SNL Financial.

 

Investments, Property/Casualty Insurers, 2015

(1) Cash and invested net admitted assets, as of December 31, 2015.
(2) Includes mortgage loans on real estate.

Source: NAIC data, sourced from S&P Global Market Intelligence, Insurance Information Institute.

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