ROCKY HILL, Conn., Oct. 27, 2026 (GLOBE NEWSWIRE) — ALIRT Insurance Research has released a new report examining U.S. life insurers’ exposure to “alternative” investments reported through Schedule BA of statutory financial statements. The analysis reviews alternative investment growth trends, portfolio composition, and investment performance, as well as regulatory changes affecting alternative asset holdings across the life insurance sector.
The report finds that life insurers have steadily increased their allocation to alternative investments over the past two decades as companies seek diversification benefits and enhanced investment returns. Schedule BA assets within the ALIRT Life Insurance Industry Composite increased from approximately $74 billion in 2005 to $374 billion as of June 30, 2026, while rising from 3.1% to 7.0% of invested assets.
The study highlights that, over the past two decades, alternative investments have generally delivered higher yields than traditional bonds and mortgage loans. While returns have moderated since the exceptional performance seen in 2021, alternative assets continued to provide yield advantages through 2025.
The report also examines the risks associated with alternative investments, noting that asset valuations can be more volatile due to their sensitivity to equity markets and their use of fair-value accounting. Nevertheless, industry exposure remains manageable, as alternative investments account for a relatively limited share of total invested assets for most life insurers. Additionally, alternative assets tend to be held by larger insurance organizations with greater investment expertise than their smaller counterparts.
The report reviews the impact of recent National Association of Insurance Commissioners (NAIC) bond reporting changes that became effective in 2025. These changes resulted in the inclusion of certain debt securities within Schedule BA that no longer met the NAIC’s revised bond definition, contributing to the exceptionally strong growth in reported alternative investment holdings in 2025.
Looking ahead, the report notes continued industry interest in alternative investments, supported by significant committed capital and the potential for higher returns relative to traditional fixed-income assets. At the same time, insurers must continue balancing the benefits of enhanced yield with the increased market volatility and capital requirements associated with certain alternative investments.
About ALIRT Insurance Research
ALIRT Insurance Research is an independent insurance industry financial analysis firm that provides research and monitoring services to institutional clients responsible for evaluating insurance company financial strength. The firm specializes in identifying trends and risks affecting life insurers, annuity providers, and other insurance organizations.
Media Contact
Ricky Cheney
ALIRT Insurance Research
1090 Elm Street, Suite 201A
Rocky Hill, CT 06067
(860) 683-2070
