The State of the Life Insurance Industry Is Good

July 29, 2020 by John T. McFie

Recently, there has been speculation that life insurance companies could be facing tough times as a result of COVID-19 and the associated financial crisis.

Even the Federal Reserve in its report on Financial Stability, which was updated May 2020, notes that, “Measures of leverage at life insurance companies […] were at the higher ends of their ranges over the past decade.”

Look in the space over this article for a graph from the Federal Reserve report. The graph shows how leverage at insurance companies has changed over time. You can see that these levels have consistently fluctuated from around 8% to 12% over much of the last 20 years.

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Originally Posted at ThinkAdvisor on July 23, 2020 by John T. McFie.