Best’s report: first-half 2022 net income in life/annuity sector up more than 60%
Net income for U.S. life/annuity (L/A) insurance industry increased by 62% in the first half of 2021, rising to $20.9 billion from $12.9 billion in the same prior-year period, according to a new AM Best report.
Thisfinancial review is detailed in a new Best’s Special Report, titled, “First Look: Six-Month 2022 U.S. Life/Annuity Financial Results,” and the data is derived from companies’ six-month 2022 interim statutory statements that were received as of Sept. 8, 2022, representing an estimated 99% of total industry premiums and annuity considerations.
Total income in the L/A industry rose 3.2% to $478.8 billion from the prior-year period, driven by a 5.3% increase in net investment income and 161.9% rise in other income. Total expenses for the industry grew 4.6%, largely due to a $12.2 billion reduction in net transfers to separate accounts. The resulting pretax net operating gain was $24.1 billion, down 18.0% from first-half 2021. A $1.6 billion decrease in tax obligations and $11.7 billion decline in net realized capital losses contributed to the industry’s net income of $20.9 billion. Capital and surplus declined 1.9% from the end of 2021, to $481.1 billion.
AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.