Private credit is emerging as a growing component in North American insurance company portfolios in recent years, according to a report published, "The Rise Of Private Credit In Insurers' Investment Portfolios, Oct. 12, 2025" by S&P Global Ratings. The report noted that it reflects a broader trend within financial services.

"Many fixed-income investors, including insurers, have increasingly turned to private credit to reap the benefits of added diversity in their investment strategies and enhanced yield potential," said Carmi Margalit, S&P Global Ratings’ life insurance sector lead.

However, the report notes that investing in private credit also comes with inherent risks for insurance companies to carefully consider, including illiquidity, as private credit investments are not easily tradable and, in nearly all cases, require insurers to hold them to maturity. 

The growth is not uniform across the industry. Life insurers, for example, often hold more private credit than property/casualty (P/C) insurers, and some companies lean more into private credit than others.

So far, S&P Global's ratings on insurers have not been affected by the growth in private credit investments because they're still a relatively small portion of the industry's more than $8 trillion of total investments, and the added risks appear to be well managed.