U.S. Life Insurers Increase Exposure to Less Liquid Bonds
U.S. life insurers have significantly increased their exposure to less liquid bonds, such as privately placed bonds, over the past decade. This trend offers higher yields but introduces liquidity and valuation risks. The fair value of Level 3 bonds held by life insurers rose from $183 billion in 2016 to $464 billion in 2025.
Topics: asset_liability_management bond_investments financial_risk life_insurance regulatory_changes