We would love to hear from you. Click on the ‘Contact Us’ link to the right and choose your favorite way to reach-out!

wscdsdc

media/speaking contact

Jamie Johnson

business contact

Victoria Peterson

Contact Us

855.ask.wink

Close [x]
pattern

Industry News

Categories

  • Industry Articles (21,155)
  • Industry Conferences (2)
  • Industry Job Openings (35)
  • Moore on the Market (414)
  • Negative Media (144)
  • Positive Media (73)
  • Sheryl's Articles (800)
  • Wink's Articles (353)
  • Wink's Inside Story (274)
  • Wink's Press Releases (123)
  • Blog Archives

  • March 2024
  • February 2024
  • January 2024
  • December 2023
  • November 2023
  • October 2023
  • September 2023
  • August 2023
  • July 2023
  • June 2023
  • May 2023
  • April 2023
  • March 2023
  • February 2023
  • January 2023
  • December 2022
  • November 2022
  • October 2022
  • September 2022
  • August 2022
  • July 2022
  • June 2022
  • May 2022
  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021
  • October 2021
  • September 2021
  • August 2021
  • July 2021
  • June 2021
  • May 2021
  • April 2021
  • March 2021
  • February 2021
  • January 2021
  • December 2020
  • November 2020
  • October 2020
  • September 2020
  • August 2020
  • July 2020
  • June 2020
  • May 2020
  • April 2020
  • March 2020
  • February 2020
  • January 2020
  • December 2019
  • November 2019
  • October 2019
  • September 2019
  • August 2019
  • July 2019
  • June 2019
  • May 2019
  • April 2019
  • March 2019
  • February 2019
  • January 2019
  • December 2018
  • November 2018
  • October 2018
  • September 2018
  • August 2018
  • July 2018
  • June 2018
  • May 2018
  • April 2018
  • March 2018
  • February 2018
  • January 2018
  • December 2017
  • November 2017
  • October 2017
  • September 2017
  • August 2017
  • July 2017
  • June 2017
  • May 2017
  • April 2017
  • March 2017
  • February 2017
  • January 2017
  • December 2016
  • November 2016
  • October 2016
  • September 2016
  • August 2016
  • July 2016
  • June 2016
  • May 2016
  • April 2016
  • March 2016
  • February 2016
  • January 2016
  • December 2015
  • November 2015
  • October 2015
  • September 2015
  • August 2015
  • July 2015
  • June 2015
  • May 2015
  • April 2015
  • March 2015
  • February 2015
  • January 2015
  • December 2014
  • November 2014
  • October 2014
  • September 2014
  • August 2014
  • July 2014
  • June 2014
  • May 2014
  • April 2014
  • March 2014
  • February 2014
  • January 2014
  • December 2013
  • November 2013
  • October 2013
  • September 2013
  • August 2013
  • July 2013
  • June 2013
  • May 2013
  • April 2013
  • March 2013
  • February 2013
  • January 2013
  • December 2012
  • November 2012
  • October 2012
  • September 2012
  • August 2012
  • July 2012
  • June 2012
  • May 2012
  • April 2012
  • March 2012
  • February 2012
  • January 2012
  • December 2011
  • November 2011
  • October 2011
  • September 2011
  • August 2011
  • July 2011
  • June 2011
  • May 2011
  • April 2011
  • March 2011
  • February 2011
  • January 2011
  • December 2010
  • November 2010
  • October 2010
  • September 2010
  • August 2010
  • July 2010
  • June 2010
  • May 2010
  • April 2010
  • March 2010
  • February 2010
  • January 2010
  • December 2009
  • November 2009
  • October 2009
  • August 2009
  • June 2009
  • May 2009
  • April 2009
  • March 2009
  • November 2008
  • September 2008
  • May 2008
  • February 2008
  • August 2006
  • A.M. Best: Outlook Stable On Life And Annuity Sector

    October 31, 2012 by N/A

    Proquest   LLC

    A.M. Best Co.’s rating outlook on the U.S. life insurance and annuity sector remains stable through mid-year 2012, despite the continued pressure of the low interest rate environment on earnings, according to its new briefing.

    In a release on October 15, A.M. Best noted that the Federal Reserve has indicated that interest rates will remain at historically low levels through at least mid-year 2015, based on the most recent Federal Open Market Committee statement on September 13. Life and annuity writers are at particular risk due to their dependency on investment income to supplement underwriting income and ultimately generate profitable earnings trends for stakeholders and policyholders.

    Asset-liability matching is critical for insurers in order to match their long duration liabilities, particularly interest- sensitive business-such as fixed and variable annuities, universal life with secondary guarantees, pre-need products, long-term disability and long-term care-with assets that will generate positive spreads, minimize reinvestment risk and achieve their investment income targets.

    Insurers have historically preferred the fixed-income securities (FIS) asset class-U.S. government, foreign government, U.S. state and special revenue (municipals), utilities, corporate and asset- backed securities-due to their generally fixed returns and high credit quality. Since a large percentage of an insurance company’s investment portfolio typically consists of FIS that were purchased at higher yields than currently are available, portfolio yields are likely to decline unless insurers reinvest in higher risk securities. In the decades prior to the financial crisis, FIS offered attractive yields that allowed companies to match their assets with long-duration liabilities, with few concerns regarding minimum interest guarantees. However, from 1997 to 2011, net yields for FIS have been declining fairly consistently, which has increased the challenge to manage investment portfolios.

    To counteract the impact of low interest rates on spread compression and earnings volatility, insurers are strategically de- risking their legacy product portfolios. Strategies include exiting, repricing or de-emphasizing certain business lines, particularly interest-sensitive businesses, and in some cases, revising their investment allocations to stretch for yield. However, other companies, instead, have de-risked their investment portfolios, which may accelerate investment yield deterioration.

    A.M. Best Company is an insurance rating and information source.

    More information:

    www.ambest.com/press/101506lifeannuitybriefing

    www.ambest.com

    ((Comments on this story may be sent to newsdesk@closeupmedia.com))

    Copyright:

    (c) 2012   ProQuest Information and Learning Company; All Rights Reserved.

    Wordcount:

    364

    Originally Posted at InsuranceNewsNet on October 30, 2012 by N/A.

    Categories: Industry Articles
    currency