Actuarial Notes

Number of Private Equity-Owned U.S. Insurers Remains Constant, But Total Investments Increase by Double Digits in 2023

By Jennifer Johnson and Jean-Baptiste Carelus · National Association of Insurance Commissioners · 2024 · CP341-102-25

Study guide: Exam CP-341

An NAIC Capital Markets Bureau special report, prepared by analysts Jennifer Johnson and Jean-Baptiste Carelus, on U.S. insurers owned by private equity firms. It reports their number as of July 2024, their total cash and invested assets at year-end 2023, and the asset types, bond types and credit quality of those investments. It covers year-end 2023 filings, compared with 2022 and 2021.

On the syllabus

Executive Summary

  • The number of private equity (PE)-owned U.S. insurers identified by the NAIC Capital Markets Bureau remained at 137 as of July 2024, compared to July 2023, but was up slightly from 132 at year-end 2022.
  • Total cash and invested assets for the 137 PE-owned insurers increased 13.5% to $605.7 billion in book/adjusted carrying value (BACV), representing 7.1% of total U.S. insurers' total cash and invested assets.
  • Bonds and mortgages remained the two largest asset types, at 63% and 17% of total cash and invested assets.
  • Asset-backed and other structured securities (nontraditional bonds) were 29% of total bonds, compared with 12% for the overall U.S. insurance industry.
  • Over 90% of all bond investments carried NAIC 1 and NAIC 2 designations.

Chart 1: PE-Owned U.S. Insurers' Total Investments 2018-2023 ($ bil. BACV)

  • The count is a 50% increase from the 90 PE-owned U.S. insurers reported in 2018, and total investments for PE-owned U.S. insurers increased 93% in the five years ending 2023.

Table 1: PE-Owned U.S. Insurer Investments as of Year-End 2023 ($ bil. BACV)

Table 2: PE-Owned U.S. Insurer Investments as of Year-End 2022 ($ bil. BACV)

Table 3: PE-Owned U.S. Insurer Bond Investments, 2021-2023 ($ bil. BACV)

Chart 2: PE-Owned Bond Investments' Credit Quality – NAIC Designations, Year-End 2023

Sources