Industry Trend - Private equity firms are increasingly involved in the life insurance and annuity sectors, managing trillions of dollars of American savings [1] - These firms are shifting investments towards complex and private markets, including subsidiaries in Bermuda and the Cayman Islands [1] Investment Strategy - Wall Street firms claim to enhance insurer investment strategies to meet obligations and offer higher returns [1] - Concerns arise regarding the use of offshore reinsurers, opaque accounting, and private market investments, which may mask underlying vulnerabilities [1] Risk and Challenges - A Pennsylvania steelworkers group filed a lawsuit to protect their retirement funds from being managed by a private equity-owned entity [1] - The collapse of PHL Variable, a life insurer, could result in a $2.2 billion shortfall, potentially impacting policyholder payouts [1] - Industry experts caution that hidden fragilities could lead to cash shortages, fire sales, or failures if a significant economic downturn occurs [1]
The offshoring of America's retirement savings
Bloomberg Television·2025-11-17 16:15