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Investment grade private credit is a consistent top five alternative allocation for insurers, according to Nuveen’s EQuilibrium survey. While often associated with life insurers, interest among P&C insurers is growing.
We share five little-known facts about investment grade (IG) private credit that P&C insurers should consider when investing in it.
Key takeaways
- Private IG has grown significantly, with annual private placement market volume estimated to be in the range of $75 to $100 billion over the last two years.
- Once comprising mainly private corporates and infrastructure debt/project finance investments, the private IG asset class expanded more recently to include private asset-backed securities, credit tenant loans and C-PACE.
- Spread premiums over public benchmarks have historically reflected the less liquid nature of private assets, but are increasingly driven by proprietary sourcing, providing opportunities for relative value.
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