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Best’s Special Report: U.S. Publicly Traded Life/Annuity Insurers’ Revenues Off 12% in 2022

Premium growth for publicly traded U.S. life/annuity (L/A) insurance companies continued to recover in 2022, but was countered by declines in investment and fee income that drove total GAAP revenue down by 12% to $291.5 billion, according to a new AM Best report.

According to the Best’s Special Report, another factor contributing to the revenue decline was $22.9 billion in realized losses, which were reported at all but three of the 18 companies used in the analysis. More than half of these companies saw an increase in premium revenue, while nearly all saw a drop in fee income, as declines in assets under management were more widespread.

“Many of the publicly traded life insurance companies have substantially reduced their product offerings in recent years due to the low interest rate environment, which made achieving targeted profit margins difficult,” AM Best Associate Director Jason Hopper said. “Because of the COVID-19 pandemic, consumers have gravitated toward protection products such as indexed universal life.”

The report also notes that with rising interest rates in 2022, L/A insurers ramped up fixed annuity production and were able to invest in higher-yielding securities and offer higher crediting rates. However, carriers began to pull back on fixed annuity sales in the latter half of 2022 to conserve capital and focus on building a more diverse product offering.

Other report highlights include:

  • Pretax operating income remained strong, up nearly 34% to $40.3 billion, with all but one company reporting positive earnings.
  • Net investment income declined by roughly $11.5 billion to $78.6 billion. The persistent drag from the low interest rate environment continues to impact margins, but ongoing growth in general account invested assets has pushed investment income higher.
  • Overall, the publicly traded L/A companies saw a significant drop in shareholders’ equity in 2022, down nearly two thirds, to $122 billion in 2022, from $351 billion in 2021, though it was flat when adjusted for unrealized losses.
  • Despite the positive change in interest rates, headwinds owing to a changing and volatile interest rate environment are likely to continue to create noise on margins until longer-term interest rates and credit spreads return to more stable and more normalized levels, which won’t be reflected in operating performance for some time.
  • Companies continue to perform relatively well despite volatility in mortality owing to COVID-19. They are still describing COVID-19 mortality as having an earnings impact as opposed to a balance sheet impact, suggesting no significant changes to surplus levels.

To access the full copy of this special report, “Premiums Grow, Revenue Drops for Public Life/Annuity GAAP Insurers,” please visit

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 New York, London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit

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