Through asset management and investments in various assets, insurance and occupational pension companies generate returns and profits that benefit the policyholders.
Swedish companies primarily invest in Swedish and foreign equities, investment funds, bonds and properties (see diagram 37). The bonds invested in by insurance and occupational pension companies are primarily bonds issued by foreign borrowers, Swedish government bonds and bonds issued by Swedish banks and mortgage institutions.
Non-life insurance companies typically invest in assets with shorter duration compared to life insurance and occupational pension companies. This is because non-life insurance companies need to manage ongoing claims payments during the year. Life insurance and occupational pension companies have a longer investment horizon as life insurance savings occur over an extended period. Similarly, the payment of pension savings also takes place over an extended period.
The proportion of equities and investment funds of the companies’ has increased since 2015 and accounted for over 53 per cent of the assets in 2022 (see figure 29). On the other hand, bonds and other fixed income assets have decreased and represented around 41 per cent of the assets in 2022. As a comparison, in 2015, bonds and other fixed income assets accounted for more than 50 per cent of the assets. The increase in equities and investment funds and the decrease in bonds and other fixed income assets can largely be attributed to favourable developments in the stock markets and low interest rates during this period. The proportion of properties has remained relatively constant and accounted for 6 per cent of the assets in 2022.
