Insurance Insights: COVID-19 Effect
on the Life-Annuity Sector
The Covid-19 pandemic impact will likely impact life insurance and annuity providers in many ways. The market fallout may lead to declines in life company portfolio asset values, greater capital charges should their larger allocations of BBB securities experience downgrades, and even more income pressure due to ongoing low interest rates. Annuity businesses are expected to experience lower premiums and separate account fees, along with significant increases in reserves and hedging costs.
Conning’s Insurance Research team has completed a comprehensive analysis of the pandemic’s impact on the life/annuity industry, as well as the property/casualty and health insurance industries. An overview of the entire industry findings is also available.
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