A Firm Foundation: How Insurance Supports the Economy

Cash and invested assets of property/casualty insurance companies totaled $1.69 trillion in 2017. This represents 88 percent of total net admitted assets, which were $1.92 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, 2015-2017 (1)

($ millions, end of year)

  Amount Percent of total investments
Investment type 2015 2016 2017 2015 2016 2017
Bonds $949,702 $973,140 $979,509 62.01% 61.25% 57.91%
Stocks $340,252 $359,165 $417,448 22.22% 22.61% 24.68%
     Preferred 14,025 10,849 5,448 0.92 0.68 0.32
     Common 326,227 348,316 412,000 21.30 21.92 24.36
Mortgage loans on real estate $12,441 $15,032 $17,324 0.81% 0.95% 1.02%
     First liens 12,209 14,407 16,644 0.80 0.91 0.98
     Other than first liens 232 625 681 0.02 0.04 0.04
Real estate $11,685 $12,272 $12,888 0.76% 0.77% 0.76%
     Properties occupied by company 8,716 8,933 9,122 0.57 0.56 0.54
     Properties held for income production 2,693 3,061 3,543 0.18 0.19 0.21
     Properties held for sale 276 278 223 0.02 0.02 0.01
Cash, cash equivalent and short-term investments 87,516 92,338 115,059 5.71 5.81 6.80
Derivatives 652 531 233 0.04 0.03 0.01
Other invested assets 121,291 128,704 137,878 7.92 8.10 8.15
Receivable for securities 2,530 1,679 2,102 0.17 0.11 0.12
Securities lending reinvested collateral assets 2,618 2,582 4,440 0.17 0.16 0.26
Aggregate write-in for invested assets 2,860 3,319 4,673 0.19 0.21 0.28
Total cash and invested assets $1,531,547 $1,588,760 $1,691,553 100.00% 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 2017, according to S&P Global Market Intelligence.

Investments, Property/Casualty Insurers, 2017

 

(1) Cash and invested net admitted assets, as of December 31, 2017.
(2) Includes mortgage loans on real estate.

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

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