U.S. Insurance Industry’s High-Yield Bond Exposure Grows Following COVID-19-Related Credit Deterioration in 2020

Link: https://content.naic.org/sites/default/files/capital-markets-special-report-covid-related-credit-deterioration.pdf



At year-end 2020, the U.S. insurance industry reported $286 billion in high-yield bond exposure,
an increase of just over 25% compared to year-end 2019 due in part to the broad-based credit
impact of the COVID-19 pandemic.

High-yield bonds accounted for 6.1% of the industry’s total bond exposure, the highest level in
more than 10 years and an increase from 5.1% at year-end 2019.

High-yield corporate bonds, asset-backed securities (ABS) and other structured securities, and
private-label commercial mortgage-backed securities (CMBS) were the primary contributors to
the increase in high-yield exposure.

Author(s): Michele Wong and Jean-Baptiste Carelus

Publication Date: 6 August 2021

Publication Site: NAIC, Capital Markets Special Report