Insights

2024 Health Industry Investment Highlights: A Year of Decade-Highs

Executive Summary

In 2024, the U.S. health insurance industry’s net investment income (%) reached a decade-high of 4.16%, supported by a prolonged high-interest rate environment and increased contributions from cash and short-term investments. The fixed income book yield also continued its upward trajectory, reaching a decade-high following notable improvements during 2022 - 2023.

Trade Winds: September 2025

August Overview

With downside risks to employment and upside risks to inflation continuing to present themselves, the minutes from the July FOMC meeting showed that more participants saw tariff induced risks to inflation as a more pressing issue than those impacting the labor market at that time, stating, “a majority of participants judged the upside risk to inflation as the greater of these two risks.”

From Caution to Opportunity: The Evolving Investment Landscape for Medical Liability Insurers

Executive Summary

In this article, we delve into the enterprise profile of U.S. medical professional liability (MPL) insurers and assess their investment performance relative to the broader U.S. property and casualty (P&C) industry. The MPL composite trailed the P&C industry in net investment income (%), partly due to its more conservative asset allocation. Within the fixed income portfolio, despite having similar average credit quality and duration relative to the broader P&C industry, the MPL composite’s book yield was lower, though the gap has narrowed recently. An in-depth comparative analysis of sector allocation and duration/quality strategy may point to opportunities to improve portfolio yields. MPL Insurers that assumed greater investment risk, particularly larger firms, tended to realize higher book yields, suggesting that selective risk-taking could serve as a lever for enhancing investment performance.

From “Known Unknowns” to Quantified Risks: Enhancing Portfolio Construction & Rebalancing with Stress & Scenario Testing

Executive Summary

Steep unrealized investment losses during the COVID-19 pandemic and the rapid rate increase in 2022 have led insurers and some regulators to refocus on stress and scenario testing. This article explores metrics for quantifying losses during periods of stress, suggesting that incorporating them into portfolio construction and rebalancing can lead to more informed investment recommendations that better align with insurers’ risk-adjusted return preferences.

2024 Health Industry Investment Highlights: A Year of Decade-Highs

Trade Winds: September 2025

From Caution to Opportunity: The Evolving Investment Landscape for Medical Liability Insurers

From “Known Unknowns” to Quantified Risks: Enhancing Portfolio Construction & Rebalancing with Stress & Scenario Testing

2024 Health Industry Investment Highlights: A Year of Decade-Highs

Executive Summary In 2024, the U.S. health insurance industry’s net investment income (%) reached a decade-high of 4.16%, supported by a prolonged high-interest rate environment and increased contributions from cash and short-term investments. The fixed income book yield also continued its upward trajectory, reaching a decade-high following notable improvements during 2022 - 2023. Read More

Trade Winds: September 2025

August Overview With downside risks to employment and upside risks to inflation continuing to present themselves, the minutes from the July FOMC meeting showed that more participants saw tariff induced risks to inflation as a more pressing issue than those impacting the labor market at that time, stating, “a majority of participants judged the upside risk to inflation as the greater of these two risks.” Read More

From Caution to Opportunity: The Evolving Investment Landscape for Medical Liability Insurers

Executive Summary In this article, we delve into the enterprise profile of U.S. medical professional liability (MPL) insurers and assess their investment performance relative to the broader U.S. property and casualty (P&C) industry. The MPL composite trailed the P&C industry in net investment income (%), partly due to its more conservative asset allocation. Within the fixed income portfolio, despite having similar average credit quality and duration relative to the broader P&C industry, the MPL composite’s book yield was lower, though the gap has narrowed recently. An in-depth comparative analysis of sector allocation and duration/quality strategy may point to opportunities to improve portfolio yields. MPL Insurers that assumed greater investment risk, particularly larger firms, tended to realize higher book yields, suggesting that selective risk-taking could serve as a lever for enhancing investment performance. Read More

From “Known Unknowns” to Quantified Risks: Enhancing Portfolio Construction & Rebalancing with Stress & Scenario Testing

Executive Summary Steep unrealized investment losses during the COVID-19 pandemic and the rapid rate increase in 2022 have led insurers and some regulators to refocus on stress and scenario testing. This article explores metrics for quantifying losses during periods of stress, suggesting that incorporating them into portfolio construction and rebalancing can lead to more informed investment recommendations that better align with insurers’ risk-adjusted return preferences. Read More

Trade Winds: August 2025

July Overview At the end of the month, the Fed held its benchmark rate range steady at 4.25% - 4.50%. Nine Fed Governors voted in favor of staying put, while two dissented in favor of a quarter point cut. Despite touting a low unemployment rate and “solid labor market conditions,” the Committee altered its view of the economy from “solid” to “moderating,” and reiterated that “uncertainty remains elevated.” Read More

2024 U.S. Life Industry Investment Highlights: Yield Momentum Persists, Though Moderating

Executive Summary In 2024, the U.S. life insurance industry’s net investment income increased by 25 bps, extending the upward trajectory observed in 2023. This growth was primarily supported by persistently elevated interest rates. Read More

2024 P&C Industry Investment Highlights: Momentum Continues, but Slows

Executive Summary In 2024, the U.S. Property and Casualty (P&C) insurance industry’s net investment income reached a decade high of 3.63%, supported by elevated interest rates and increased equity dividend income. Over the past three years, one large insurer has notably influenced industry asset allocations by reducing its exposure to Schedule BA assets and equities, while increasing holdings in cash and short-term investments. Excluding this outlier, the industry’s overall asset mix has remained relatively stable. Meanwhile, the fixed income portfolio experienced a continued increase in book yield, along with improved credit quality and stable duration. The industry’s allocation to tax-exempt municipal bonds declined steadily, replaced by growing investments in corporate bonds and structured securities. Read More

Trade Winds: July 2025

June Overview The Fed stayed the course in June, keeping the benchmark policy rate range at 4.25 - 4.50% while advocating a cautious approach as recent trade policy measures have yet to show their impact on economic activity and inflation. Per its statement, the Fed believes that uncertainty has “diminished but remains elevated,” the labor market is in “solid” shape, while Read More

Investing in Structured Securities Under Solvency UK: Attractive Opportunities for Lloyd's Syndicates

introduction On 1 November 2024, the UK implemented Securitisation Regulation 2024, which is reshaping how institutional investors — such as Lloyd’s syndicates — assess the structured securities markets. This departure from the EU regulations has modernised the regulatory approach, which aligns better with practices in the US market, and streamlines compliance for UK-based institutional investors. This publication discusses the investment opportunities for Lloyd’s syndicates and other London Market entities. Read More

Trade Winds: June 2025

May Overview With “heightened uncertainty” still dominating consumer and business sentiment, the Fed unanimously voted to maintain its benchmark rate range at 4.25-4.50%. Arguing that the economy is “still in a solid position,” with unemployment at 4.2%, and inflation lower but still above its target, the Fed remains tethered to the position that upholding the status quo is the best position at this time until hard data encourages them to act otherwise. Read More

NEAM Insights

2024 Health Industry Investment Highlights: A Year of Decade-Highs

Executive Summary

Trade Winds: September 2025

August Overview

From Caution to Opportunity: The Evolving Investment Landscape for Medical Liability Insurers

Executive Summary

From “Known Unknowns” to Quantified Risks: Enhancing Portfolio Construction & Rebalancing with Stress & Scenario Testing

Executive Summary

Topics

TOPICS

Publications

Authors

2024 Health Industry Investment Highlights: A Year of Decade-Highs

Trade Winds: September 2025

From Caution to Opportunity: The Evolving Investment Landscape for Medical Liability Insurers

From “Known Unknowns” to Quantified Risks: Enhancing Portfolio Construction & Rebalancing with Stress & Scenario Testing

Trade Winds: August 2025

2024 U.S. Life Industry Investment Highlights: Yield Momentum Persists, Though Moderating

2024 P&C Industry Investment Highlights: Momentum Continues, but Slows

Trade Winds: July 2025

Investing in Structured Securities Under Solvency UK: Attractive Opportunities for Lloyd's Syndicates

Trade Winds: June 2025