US Insurance Outlook ’26: Life Sector Trends (1/4)
Josh Esterov, CFA - Co-Head of U.S. Financials, CreditSights
Cindy Chen - Associate Analyst, CreditSights
5 January 2026
Insights into US Insurance Outlook ’26: Life Sector Trends, including:
- Regulatory capital reaches record-high levels: Consequently, US Life Insurance sector’s capital and surplus position stands at approximately $536 billion at 3Q25.
- Mortality trends demonstrate stabilization across segments: Group Life insurers report benefit ratios matching pre-pandemic levels while Retail Life performance gradually improves throughout 2025.
- Annuity sales achieve unprecedented growth trajectory: Fixed annuities target record $321 billion while variable annuities approach $139 billion driven by favorable demographics and markets.
- Pension Risk Transfer activity sustains robust momentum: MetLife writes $12 billion in fourth quarter transactions as pension funded ratios exceed 100% throughout 2022-2025.
- Capital efficiency strategies expand industry-wide adoption: Moreover, insurers increasingly utilize captive reinsurance, private letter ratings, and FABN issuance reaching $81 billion in 2025.
Executive Summary
Part 1 analyzes US Life Insurance sector operating trends and key themes for calendar year 2026. Coverage includes capital strength, mortality stabilization, annuity sales performance, and investment portfolio strategies.
Regulatory capital reaches unprecedented levels at approximately $536 billion through third quarter 2025 positioning. Mortality trends demonstrate stabilization with Group Life matching pre-pandemic benefit ratios while Retail Life gradually improves.
Annuity sales achieve record-breaking performance targeting $321 billion in fixed annuities and $139 billion variable products. Favorable demographics, elevated interest rates, and strong equity markets drive unprecedented consumer demand throughout 2025.
Pension Risk Transfer activity sustains momentum with MetLife writing approximately $12 billion fourth quarter transactions alone. Consequently, private credit allocation continues expanding reaching 31.4% of total investment portfolios at year-end 2024.
Notable transactions include Aquarian’s $4.1 billion Brighthouse acquisition alongside significant reinsurance deals totaling substantial volumes. Moreover, capital efficiency strategies proliferate through captive reinsurance utilization and record FABN issuance exceeding $81 billion.
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