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Increasing duration was the most popular course of action in Nuveen’s 2024 EQuilibrium survey of institutional investors. Half of the 800 respondents said they would be doing this, in contrast to the 19% who planned to decrease it. And insurers were even more likely to extend: 61% of North American insurers, 58% in Asia Pacific and 53% in Europe.
It’s not surprising insurance companies are looking to capitalise on ways to lock-in higher rates and match long-term liabilities.
The surprise is the investment choices used to express this view: two lesser-known but innovative debt instruments – Commercial Property Assessed Clean Energy (C-PACE) and credit tenant loans; and US municipal bonds, which are often overlooked to extend duration.
Find out how insurers are using these strategies in their portfolios.
