A Firm Foundation: How Insurance Supports the Economy

Insurance companies help fund the construction of schools, roads and healthcare facilities as well as a variety of other public sector projects through their investments in municipal bonds. The P/C insurance industry invested $298 billion in such bonds in 2020, and the life insurance industry invested $234 billion, according to the Federal Reserve. (See here and here for further information on insurance industry investments.)

Insurance Company Holdings Of U.S. Municipal Securities, 2016-2020

($ billions, end of year)

  2016 2017 2018 2019 2020
Property/casualty insurance companies $350.7 $338.9 $291.6 $285.2 $297.9
Life insurance companies 185.2 197.8 190.0 215.0 234.2
Total $535.9 $536.7 $481.6 $500.2 $532.1

Source: Board of Governors of the Federal Reserve System, June 11, 2020.

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