The COVID-19 pandemic’s impact on the life-annuity and property-casualty insurance segments has been widespread, but it’s not the only important industry development, according to Conning’s Insurance Research team.
The life-annuity industry is facing pressure on premium and operating margin, thanks mainly to the pandemic, but it is also concerned with declining interest rates, affecting insurers’ ability to generate investment income. And while demand is up for indexed annuities, pending regulations may add some constraints to life insurance product sales overall.
Reduced premium and lower portfolio yields are also pressuring property-casualty insurers, and uncertainty over business interruption claims are an additional concern. Commercial markets appear to be hardening, but this is helping spur public and private capital-raising to pursue various commercial market opportunities.