The Global Risks Alliance (GRA)
Insurers, especially life insurers, hold growing amounts of private credit, often through affiliated asset managers. Private credit offers higher yields that match long liabilities, and also brings illiquidity, complexity and reliance on private ratings. This page sets out how insurers' private credit exposure creates risk, how supervisors measure it, and who decides.
GRA · In development · service level R0
Insurers and private credit describes the growing holdings of private loans by insurers, especially life insurers, often through affiliated asset managers. It brings yield suited to long liabilities, along with illiquidity, reliance on private ratings and cross-border reinsurance questions. Supervisors, insurer boards and rating overseers hold the decisions.
Which places drive loss in a severe year, and how far it reaches into reinsurance. Illustrative design values.
Insurer asset allocations and risk. The dossier below sets out how the risk develops, what is measured, where the data come from, how it is modelled and who decides.
Annuity and life liabilities suit long-dated assets. Private credit adds spread, which supports pricing and returns, while reducing liquidity.
Insurers owned by or partnered with asset managers may invest heavily in assets those managers originate, raising questions of fees, valuation and independence.
Capital charges depend on ratings. Private letter ratings, not publicly scrutinised, can assign higher ratings than comparable public assessments.
Reinsurance of blocks of liabilities to affiliated reinsurers in other jurisdictions can change capital and investment rules applying to the assets.
Each term as this page uses it. Where a standard-setting body defines the term, the wording follows that body.
| Term | Definition |
|---|---|
| Private letter rating | A credit rating provided privately rather than published, used by some insurers for capital purposes. |
| Funded reinsurance | Reinsurance where the reinsurer takes on liabilities together with the assets backing them. |
| Affiliated asset manager | An asset manager that owns or is under common ownership with an insurer whose assets it manages. |
Each indicator carries its unit, its cadence, the kind of source behind it and the evidence label a value would carry. No values are shown: a programme supplies them under its own authority.
| Indicator | Unit | Cadence | Source type | Label |
|---|---|---|---|---|
| Insurer private credit holdings | currency and share of investments | annual | Statutory filings | OFFICIAL |
| Share of investments managed by affiliated asset managers | percent | annual | Statutory filings and studies | REPORTED |
| Privately rated securities held | currency | annual | NAIC data | OFFICIAL |
| Assets ceded to affiliated offshore reinsurers | currency | annual | Supervisory and research studies | ESTIMATED |
| Liquidity coverage of insurers under stress | ratio | annual | Supervisory liquidity stress tests | MODELLED |
| Private equity-affiliated insurer market share | percent of annuity sales | annual | Industry and research data | ESTIMATED |
The topic as a computational graph: named sources feed the methods, an evidence review gates the outputs, and the decisions stay with the authorities that hold them.
Fig. 02Nodes carry their type, two metric rows and a state; connectors show what feeds what; dashed frames name the owners; the timeline is the cadence. Design of the pipeline, not a record of a run.
Named public datasets and institutional records, each with its licence class. Sources by agreement are used only under their terms and never republished.
| Source | What it gives | Licence class |
|---|---|---|
| NAIC Capital Markets Bureau special reports | Insurer private credit and privately rated holdings | Free to read, NAIC terms |
| IAIS Global Insurance Market Report | Global monitoring of insurer investment trends | Free, IAIS terms |
| Bank of England and PRA work on funded reinsurance | Risks from asset-intensive reinsurance | Free, Bank of England terms |
| Federal Reserve and academic studies on private equity-affiliated insurers | Analysis of investment and reinsurance patterns | Free to read, terms per publisher |
| EIOPA financial stability reports | EU insurer investment and liquidity | Free, EU reuse terms |
Private Credit prepares evidence. The decisions below are taken by the authorities named, under their own rules, and never by the platform.
| Who decides | The question | Evidence this page serves |
|---|---|---|
| Insurance supervisors | How private credit and private ratings are treated for capital | Holdings data and rating reviews |
| Insurer boards and investment committees | How much private credit to hold and through whom | Liquidity, capital and conflict evidence |
| Rating agencies and the NAIC | How private ratings are reviewed | Rating comparisons |
| Reinsurance supervisors | Whether cross-border reinsurance arrangements are adequately supervised | Reinsurance and asset data |
How yield, duration matching and capital treatment shape allocations.
Credit, liquidity, valuation and concentration risk in private assets.
What changes when insurers and asset managers are affiliated.
How losses or liquidity needs could affect policyholders and markets.
Life insurers hold long-term liabilities and seek long-term assets with predictable cash flows. Private credit can offer higher yields than public bonds for similar credit quality, though with less liquidity and transparency.
Capital treatment influences allocation. How regulators treat private assets for solvency purposes affects their attractiveness, and differences across jurisdictions can drive structuring choices.
Affiliation between insurers and asset managers can align expertise but raises questions about conflicts, fees and the independence of valuation and allocation decisions.
Liquidity matters even for long-term investors. Surrenders, collateral calls on derivatives or reinsurance arrangements can create needs for cash that illiquid assets cannot meet quickly.
Cross-border reinsurance of annuity books, sometimes to jurisdictions with different capital rules, adds another layer that supervisors and researchers are examining, because it can move risk to places where it is harder to observe.
| Method or data | What it shows | Its limit |
|---|---|---|
| Insurer statutory filings | Asset allocations | Classification of private assets varies |
| Solvency frameworks | Capital treatment | Differences across jurisdictions |
| Ownership mapping | Affiliations between insurers and managers | Complex group structures |
| Stress analysis | Solvency and liquidity under scenarios | Assumption-dependent |
The current service level is R0: information and enquiries. An enquiry receives a reference and names the next step; applications, payments, compute allocations and registrations open only when their team, terms and review capacity exist.