Steady Growth in Life Settlements Amidst Economic Challenges
According to Conning's recent report on life settlements, the market remains resilient, attracting a consistent influx of capital despite ongoing economic fluctuations. The analysis reveals that growth in opportunity is substantially outpacing the current investments within the asset class, indicating a healthy and evolving market.
Key Insights from the Report
Conning's annual review, titled "Life Settlements: Steady On," examines significant factors that are propelling the life settlement industry's growth. The report highlights consumer interest and capital readiness to invest in life settlements as crucial signs of a thriving market.
Roberta Lauria, an Assistant Vice President of Insurance Research at Conning and the report's author, states that the average annual face amount of new life settlements is projected to reach a remarkable $5 billion. This continued upward trend in in-force life settlements bodes well for the tertiary market, providing a robust environment for investments.
The Appeal of Life Settlements
Investors have shown a keen interest in life settlements, largely due to their lower correlation with broader market movements, which have seen significant volatility due to interest rate changes and fluctuations in equity markets over the past two years. This tug on interest is pushing investors to be more selective regarding the financial health of the underlying insurance companies.
Scott Hawkins, Head of Insurance Research at Conning, adds that careful scrutiny of the issuing companies' financial stability is becoming essential for investors. The latest analysis illustrates that at the end of 2023, the companies chosen by life settlement investors had a risk-based capital (RBC) average that was slightly above the broader life insurance sector. This reflects a pattern where investors prefer well-capitalized insurers for their policies.
Analyzing Market Performance
The study delves into the mechanics of the life settlement market and provides a detailed forecast for the years ahead, from 2024 to 2033. It doesn't just recount history; it paints a picture of future possibilities and potential obstacles that investors may face.
As life settlements continue to garner attention, the long-term view suggests a strong market with ample opportunities for growth and investment returns. Conning’s report serves as a comprehensive analysis that could guide investors in making informed decisions moving forward.
About Conning
Conning, founded in 1912, has a rich heritage of contributing to the insurance sector. The company provides investment solutions, risk modeling tools, and insightful research to institutional investors, including insurers and pension plans. With operational hubs spanning across Asia, Europe, and North America, Conning has positioned itself as a key player in the global investment landscape, managing approximately $740 billion in assets under its Generali Investments platform.
Frequently Asked Questions
What is the focus of Conning's latest report?
The report focuses on the life settlements market, analyzing its growth trends and forecasting future developments.
What is the projected average annual face amount for new life settlements?
According to Conning, the average annual face amount of new life settlements is projected to reach $5 billion.
How is the financial health of companies affected by life settlements?
Investors are increasingly paying attention to the financial strength of the insurance companies behind life settlements, favoring well-capitalized insurers.
What years does Conning's forecast cover?
The forecast extends from 2024 to 2033, providing a long-term outlook on the life settlements market.
How long has Conning been in operation?
Conning was founded in 1912, boasting over a century of service to the insurance industry.
