Insurers remain optimistic about their investments going into 2026, despite heightened market uncertainty.
This marks the fifth year in which Conning surveyed U.S. insurers about their investment focus. Two Conning analysts unpacked the 2026 findings in a recent webinar.
“Markets performed pretty well in 2025 despite Liberation Day and a lengthy government shutdown,” said Matt Reilly, head of insurance solutions at Conning. “Investment performance for insurers has been strong over the last few years.”
Insurer optimism remained high between 2024 and 2026, Conning found, with 79% of insurers surveyed saying they had a positive view of the future in 2026, down only one percentage point from 2024.
Market volatility is insurers’ biggest portfolio concern
But some risks persist, Reilly said.
Market volatility, inflation and recession risk lead the list of insurers’ portfolio concerns over the next 2-3 years. Those concerns were followed by liquidity risk, the domestic political environment and the impact of monetary policy.
The Federal Reserve’s expectation to reduce interest rates further in the next 12 months influences the investment strategy of nearly every insurer surveyed. Meanwhile, more than three-quarters of insurers surveyed said they anticipate an increase in inflationary pressures.
Most insurers expect positive equity returns in 2026, with 65% looking at returns of up to 10% and 19% expecting returns of more than 10%.
Risk appetite persists
Insurers’ risk appetite persists as caution emerges, said Jeremy Lachtrupp, Conning managing director of insurance solutions. More than half of insurers surveyed (57%) said they expect to increase their investment risk in the year ahead. This is a drop from the 62% who reported the same in 2025. More than three-quarters (76%) said they expect to extend their portfolio duration in 2026.
Insurer capital continues to shift beyond traditional fixed income, Conning found. More than half of insurers surveyed said they plan to increase their allocations in areas other than traditional fixed income, including 60% that said they will increase their allocations to asset-based finance and 57% that will raise their allocations to private equity.
Portfolio repositioning is driving higher portfolio turnover, with 73% of insurers reporting higher turnover in 2025.
Interest in private assets continues to increase for insurers, the survey found. Nearly 9 in 10 respondents (88%) expect private assets to exceed 10% of their total portfolio allocation within two years.
Liquidity remains adequate for most insurers, with 76% reporting adequate or excess liquidity.
Today, almost every aspect of life is connected to the internet, from banking and investments to travel, home security systems, and even appliances. While that connectivity brings convenience, it also creates opportunities for cyber criminals.
That’s where cyber liability insurance comes in.
Just as homeowners’ insurance protects our physical homes and personal belongings, cyber coverage helps shield us from financial loss and disruption caused by online threats such as identity theft, fraudulent wire transfers, ransomware attacks, and unauthorized access to personal data.
It also provides access to specialists such as digital forensics experts, identity restoration professionals, and legal advisors. These professionals provide proactive analysis, help investigate incidents, and guide the recovery process.
While cyber coverage can benefit a variety of individuals, it’s particularly important for the affluent population.
As an advisor, it’s your responsibility to make these individuals aware of cyber liability insurance and help them determine whether it makes sense for their unique situation.
“Your job is to remind high-net-worth clients that prevention, cyber hygiene, zero trust, plus protection is the best strategy,” said Tamara M. Stephens, senior vice president, national client executive at Marsh Private Client Services.
How cyber coverage benefits high-net worth clients
High-net-worth families often face elevated cyber risk because of their visibility, financial resources, and complex lifestyles.
Many of them have multiple residences, connected smart home systems, domestic staff, and significant financial accounts. They may also move large sums of money around electronically for business, investments, real estate transactions, or philanthropy.
“These dynamics can make affluent individuals attractive targets for cyber criminals who use increasingly sophisticated tactics such as social engineering, AI-powered phishing and deepfakes, ransomware, extortion, and fraudulent wire transfer schemes,” said Lauren Dowling, senior vice president, head of World Private Client Group at World Insurance.
Many cyber insurance programs offer proactive services such as cybersecurity assessments, guidance on protecting smart home networks, and support from digital security professionals who can help identify their vulnerabilities before they can be exploited.
“For high-net-worth families, cyber protection is increasingly viewed as part of a broader personal risk management strategy protecting not only finances, but also privacy, reputation, and family security,” Dowling added.
Stephens pointed out that while some individuals may choose to self-insure, having access to specialized expertise and comprehensive support significantly reduces stress and ensures a swift, effective response during high-stakes cyber incidents.
Guiding affluent clients on cyber risk
These days, we hear too many cases where people are victimized and lose their life savings, all because of one incident.
“It’s important to empower the wealthy with the knowledge to understand it’s not just about identity theft anymore. It’s about cybercrime and taking a defensive and proactive approach to protection. The sooner we adopt this, the safer and better everyone will be,” said Mila Araujo, national practice leader, personal cyber insurance at NFP.
Once you determine that a high-net-worth client is a good candidate for cyber liability insurance, these tips can help you support them.
Start the conversation with real-world scenarios
Many wealthy clients underestimate their personal exposure to cyber risk. Discussing common situations, such as fraudulent wire transfers or compromised email accounts, helps connect the dots between incidents they’ve already heard about and how similar attacks could impact them.
Connect cyber risk to lifestyle
Those with smart homes, multiple properties, children active on social media, or significant online financial activity often have greater exposure. Make sure they understand how this coverage can benefit their particular life.
Focus on the response team, not just the policy
One of the biggest benefits of cyber coverage is access to experts who can identify vulnerabilities, quickly investigate fraud, restore identities, recover data, and guide clients through the process. Educate clients on this, as many might be unaware.
Encourage basic cyber hygiene
Being proactive can go a long way. Recommend practical safeguards such as multi-factor authentication, password managers, and establishing protocols like verbally verifying wire instructions before sending funds.
Position cyber coverage as part of holistic protection
Just as affluent families insure their homes, collections, and liability exposures, protecting their digital lives has become an essential component of modern personal risk management.
“For many affluent families, cyber risk is no longer just a technology issue; it’s a personal security issue. Protecting digital access points has become just as important as protecting physical assets and is now integrally tied to safeguarding property, wealth, reputation, and legacy,” Dowling said.
A roofers’ union is the latest organization to file a lawsuit accusing a major health insurer and its pharmacy benefit manager of orchestrating a scheme that allegedly drove up prescription drug costs while withholding billions of dollars in rebates.
The complaint, filed in a Rhode Island federal court on Wednesday, alleges that CaremarkPCS Health — one of the nation’s largest pharmacy benefit managers — used its control over drug formularies to favor higher-cost medications in exchange for payments routed through a related company. CVS Health Corp., owner of Caremark, is also a defendant.
The lawsuit comes on the heels of a similar complaint filed last month in Illinois by the Plumbers’ Welfare Fund, accusing Express Scripts and its parent company, Cigna, of a similar scheme.
Caremark has long said its role is to negotiate lower net drug costs for clients and ensure access to safe and effective medications. The Roofers’ Unions Welfare Trust Fund said they paid billions annually to Caremark to manage prescription drug benefits for millions of members.
The union “represents workers’ rights in all segments of the roofing and waterproofing industry” and is located in Oak Brook, Ill. CaremarkPCS is headquartered in Rhode Island.
CVS could not be reached for comment.
‘Manipulation scheme’
According to the lawsuit, Caremark attracted clients by promising to reduce costs through rebate negotiations with drug manufacturers and careful management of formularies, the lists of medications covered under health plans.
But the plaintiffs allege those promises were undermined by what they describe as a “Formulary Manipulation Scheme” involving Caremark, its parent, CVS Health, and subsidiary Zinc Health Services.
The lawsuit claims Caremark steered drugmakers to make large payments to Zinc — described in the filing as a group purchasing organization created in 2020 — rather than securing higher rebates for clients. Those payments were allegedly labeled as service fees but functioned as kickbacks tied to favorable placement of drugs on formularies.
“Defendants’ scheme of negotiating with drug companies for the payment of billions of dollars to Zinc, falsely labeled as service and other fees, has reduced by billions of dollars the payments that Roofers and the Class received from Caremark as rebates,” plaintiffs state. “Instead of using their negotiating leverage to maximize the rebates secured for Caremark PBM customers as they represented they would do, Defendants used that leverage to extract payments to Zinc for their own benefit.”
Preferred access alleged
The plaintiffs allege that, in exchange for the payments, Caremark gave preferred formulary placement to higher-priced brand-name drugs while excluding or limiting lower-cost alternatives, increasing costs for plan sponsors and their members.
Nearly every major drug company participated in the scheme, plaintiffs allege, including AbbVie, Amgen, AstraZeneca, Bayer, Bristol-Myers Squibb, Boehringer Ingelheim, Eli Lilly, Gilead Sciences, Johnson & Johnson, Merck, Novartis, Novo Nordisk, Pfizer and Sanofi.
The lawsuit further claims that these practices violated contractual obligations requiring that compensation from drug manufacturers be tied to legitimate services, as well as the implied duty of good faith and fair dealing.
The alleged scheme dates back to March 2020, when Zinc was established, and continues to the present, according to the filing.
Plaintiffs also point to ongoing scrutiny of pharmacy benefit managers by regulators and lawmakers, citing investigations by the Federal Trade Commission, state officials and congressional committees.
The lawsuit seeks to recover the plaintiffs’ alleged losses, along with additional damages and other relief.
A new National Association of Insurance Commissioners working group aims to identify policy solutions to rising health care costs and insurance premiums, intending to produce a practical guide for state policymakers by the end of the year.
The Health Care Affordability and Mitigation Working Group met for the first time last week. Members discussed a 2026 work plan, outlining a fast-paced schedule to develop affordability recommendations for regulators and lawmakers.
The initiative will focus on examining factors that drive health care costs and insurance premiums, including expenses within the health system that ultimately flow into insurance pricing.
‘Focus on solutions’
Kate Harris, chief deputy commissioner of the Colorado Division of Insurance, is chairing the working group.
“We really want to focus on solutions,” Harris said. “We’re all pretty familiar with what some of the issues are in the market right now, but we’d really urge this group to be thinking through, what are solutions that you’ve seen work well in your state?”
Regulators said the group will study cost drivers such as hospital prices, prescription drug spending and benefit design, while also highlighting policy approaches states have used to address affordability.
Rather than producing a lengthy white paper, the group is considering a collection of shorter briefs outlining individual policy solutions. The document would serve as a practical resource for state policymakers exploring ways to lower health coverage costs.
“I think in the short term, we’ll need to really listen to good ideas, whether it’s about benefits, whether it’s about inputs,” said Kevin Beagan, deputy commissioner of the Health Care Access Bureau at the Massachusetts Division of Insurance. “I think we’ll definitely use the experience of the individual states to really look at things.”
The working group is sure to discuss the Colorado Option in Harris’s home state. A state-governed program, Colorado Option requires all private health insurance companies to offer standardized health benefit plans in the individual and small group markets.
While it is often called a “public option,” the plans are still sold and managed by private insurers—such as Anthem and Kaiser Permanente—rather than the government.
Health insurance costs have surged at their fastest pace in over 15 years as of early 2026, driven by a combination of high-priced medical innovations, rising provider costs, and major federal policy shifts.
“It used to be around 22% of total costs, and now it’s over 25%,” he said, adding that the group may draw on research from other NAIC efforts focused on pharmaceutical spending.
Martin Swanson is the deputy director and general counsel for the Nebraska Department of Insurance. He noted that hospitals do a lot of complaining about their profit margins yet seem to keep building new wings.
“How much does it actually cost to do an MRI? How much does it actually cost to go through a CT scan?” Swanson asked. “How much money now are the providers charging because of various other cuts to maybe their income? But how much are being charged on the backs of insurers to make up for that cost?”
Joylynn Fix is the director of life and health for the West Virginia Office of the Insurance Commissioner. Facility fees charged by hospitals are becoming a growing concern in her state, Fix said.
“Facility fees are killing us here,” she said. “People are starting to stop seeking care because of facility fees. So, I’d love to see anything this group can take up with that.”
Under the proposed timeline, the working group hopes to develop an outline by late April, gather feedback in May and begin drafting the document during the summer. A first draft could be released in late summer or early fall, with a final version targeted for the NAIC’s winter national meeting.
Industry groups also signaled interest in contributing to the effort. A representative for AHIP said affordability is the top issue for the organization and that it plans to share research and policy ideas with the working group.
The working group plans to gather additional input from regulators and stakeholders ahead of the NAIC’s spring national meeting in San Diego, where members expect to further refine the list of policy topics and begin shaping the final affordability framework.
Although half of U.S. adults say they feel financially secure, a sizable number – particularly young adults – are investing in or are considering investing in high-risk/speculative assets such as prediction markets, sports betting and cryptocurrencies.
That was among the findings of Northwestern Mutual’s 18th annual Planning & Progress Study.
The number of Americans who said that they’re financially secure went up across every generation, with the largest year-over-year gains coming from millennials and Generation X, the survey said. And among Americans with a financial advisor, 71% said they felt financially secure while only 10% did not feel financially secure.
Financial discipline also improved. The number of Americans who consider themselves to be “disciplined” financial planners hit a high of 65% in 2020, during COVID-19. Four years later, it fell to a record low of 45% in 2024. Now it is on a two-year upward trend.
Reasons for feeling financially secure
People tend to adapt, and that adaptation can fuel optimism, said Travis May Sr., financial advisor at Northwestern Mutual, in explaining Americans’ high level of optimism. After sustained price pressures, he said, many households trim spending, find ways to save or reorganize priorities. These can net small wins that restore a sense of control.
At the same time, he added, market rebounds in some sectors, steady hiring in parts of the economy and sporadic wage gains can give people tangible reasons to feel better about their prospects. Some families also built emergency savings during COVID-19 or other periods of increased saving, which can provide a psychological boost. “When people feel a bit more prepared, optimism follows, even when challenges remain,” May said.
Americans show interest in high-risk assets
According to the study, Generation Z and millennials make up the largest share of Americans who are investing in – or are considering investing in – high-risk speculative assets this year. These young adults demonstrate the strongest interest in cryptocurrencies, sports betting and event-based contracts offered through prediction markets.
As to why some Americans are investing in or are considering investing in high-risk or speculative assets, May said that the most straightforward answer is that many people feel behind. “When traditional paths don’t seem fast enough, chasing outsized returns can feel like a shortcut,” he said. Also, the barriers to entry are lower through apps and social media, and sports betting culture has further normalized speculative behavior. “For some” he added, “it’s an entrepreneurial, risk-seeking mindset — accepting volatility for the chance of outsized reward.”
May said that what’s often overlooked, though, are the time horizon, the real probability of loss and the role of investor emotions. Investor sentiment often moves in concert with investment cycles — beginning with optimism and excitement, then peaking at euphoria, and then shifting to anxiety, denial, fear and panic if outcomes disappoint, before beginning an upward trend back to optimism and acceptance. “Unmanaged volatility,” he added, “can erase years of progress, which is why engaging a financial advisor can prove beneficial to both the novice and self-proclaimed do-it-yourself “investment guru.”
Americans’ blind spot
Another finding from the survey is that more than half (52%) of Americans said that they suffer from a common blind spot: They place too much emphasis on building wealth/growing their assets without dedicating enough to protecting their assets and managing against risks. And younger adults are reporting this planning gap more often: For Gen Z, the percentage is 57% and for millennials, it’s 62%.
To help address these blind spots, May said that “when working with clients, we can help by making protection the foundation of any plan. The job of a financial professional is helping a person understand that progress is worth protecting and identifying where they may be vulnerable to substantial setbacks.”
“This job begins,” May added, “by ensuring emergency savings, disability coverage and appropriate life insurance are in place so a single setback doesn’t derail goals.”
Speculative activity should be placed within a written “risk budget” so it becomes a controlled choice —an agreed-upon slice of disposable or “fun” money rather than an accidental overexposure, May added. Scenario modeling can also help clarify how incidents such as job loss, health events or market drawdowns affect outcomes. Seeing the numbers often recalibrates risk appetite more effectively than abstract warnings.
The ultimate goal, May said, is to preserve optionality through protection, clarify tradeoffs and allow clients to pursue growth in a way that doesn’t jeopardize what matters most. “Our message is simple: If you’re feeling pressure to catch up, start with a plan that protects the progress you’ve made today so you can pursue growth tomorrow,” he added.
The 2026 Planning & Progress Study was conducted by The Harris Poll on behalf of Northwestern Mutual among 4,375 U.S. adults aged 18 or older. The survey was conducted online between January 5 and January 21, 2026.
A federal judge officially killed the Department of Labor’s Retirement Security Rule on Tuesday.
District Judge Reed O’Connor acquiesced to the request from both the DOL and the group of trade groups suing to stop the rule.
“Today’s decision rightly vacates and sets aside the 2024 Rule, which exceeded the DOL’s statutory authority and was arbitrary and capricious,” the Securities Industry and Financial Markets Association and Financial Services Institute said in a joint statement. “The order ensures that financial advisors can continue to provide the services best suited for each individual client. The 2024 rule was materially indistinguishable from a 2016 DOL rule that was struck down by the Fifth Circuit in 2018.”
Since 2015, the DOL has made multiple efforts to expand the definition of “fiduciary” under the Employee Retirement Income Security Act of 1974, aiming to require that financial professionals who give retirement advice — including brokers, agents and insurance sellers — put clients’ best interests first.
So far, the industry is undefeated in opposing such efforts.
“Today’s court ruling is a major win for every American saving for retirement,” said Finseca CEO Marc Cadin. “The Fiduciary Rule placed barriers to Americans trying to save for retirement. Removing this regulation makes it easier for retirement savers to access the sound professional advice that creates results.”
Finseca, the American Council of Life Insurers and others recently met with DOL Secretary Lori Chavez-DeRemer and Assistant Secretary Daniel Aronowitz to discuss the future rule.
“Overall, I was extremely impressed with the DOL’s leadership,” Cadin said in an email to members. “They asked terrific questions, listened to our perspective, and were extremely committed to promoting lifetime income solutions like annuities that so many Americans rely on and so many more need.”
In April 2016, the DOL finalized a broad fiduciary rule set to apply in 2017, but that rule was vacated in 2018 by a federal appeals court, which said the agency had exceeded its authority.
In April 2024, under a new administration, the DOL issued another rule — dubbed the Retirement Security Rule — again expanding the fiduciary definition to include many more retirement-investment advisors and amending prohibited-transaction exemptions.
The rule was slated to take effect in September 2024. However, legal challenges quickly followed. In July 2024, a federal judge issued a nationwide stay, blocking implementation while the lawsuit proceeded.
In 2025, favorable economic conditions, along with aging demographics and more advisors selling annuities, led to record-breaking individual annuity sales in 2025. Banks and broker-dealers did especially well, a new survey finds.
Higher interest rates allowed insurance companies to offer attractive crediting rates on accumulation products and payout rates on guaranteed income products, a major factor in sales.
According to Saltzman Associates’ inaugural annuity market year in review, which looked at institutional distribution, nearly all product lines experienced growth, with registered index-linked annuities seeing the largest growth rate in 2025 at 17%.
LIMRA’s Retail Annuity Sales Survey, which represents 92% of the U.S. market, shows total U.S. annuity sales marked a new record in 2025 – increasing 6% to $461.3 billion. LIMRA data reveals that RILA sales also set new annual sales records in 2025, increasing 20% year over year to $79.6 billion.
The Salzman report is based on data from 32 banks and broker-dealers, representing nearly $90 billion in annuity premium in 2025. This review focuses on annuity distribution channels across banks, independent broker-dealers, regional and national broker-dealers, as well as wirehouses.
The bank channel
With the favorable interest rate environment in 2025, fixed-rate deferred annuities continued to make up an overwhelming majority of bank annuity sales.
“Bank customers tend to be more conservative. With an average guaranteed return rate of just under 5% on three-to-five-year duration FRDs continue to be attractive to these consumers,” said Todd Giesing, vice president with Saltzman Associates and author of the report. LIMRA data show FRD sales improving 5% year over year to $160.6 billion.
Fixed indexed annuities did not fare as well in 2025. Given the strong risk-free rates in fixed-rate deferred products, it appears bank advisors and investors favored fixed-rate guarantees over the higher earning potential of FIA products. FIA sales in banks declined 2% in 2025.
Overall, FIA sales, according to LIMRA, were $128.2 billion in 2025, 1% higher than 2024 results.
The banks saw an increase in both traditional variable annuity and RILA sales. Traditional VA sales increased 19%, while RILA sales increased 33%. Registered annuity product sales, however, are still a small portion of banks’ overall annuity production, with both product lines only accounting for 13% of overall annuity sales.
Independent BDs record big sales
Of all the annuity channels, independent BDs have the largest menu of annuity products. Annuity sales in this channel skew more heavily to registered products, and 2025 results did not depart from that trend. Only one-quarter of the channel’s 2025 sales were in non-registered fixed products, with the remainder in traditional VA and RILA products.
Notably, over half of total annuity sales in this channel went to RILA products in 2025. RILA sales increased 10% in 2025 as the balance of growth potential and downside protection continues to resonate with advisors and investors. Traditional VA products continued to rise with sales increasing 5% for 2025.
“Frankly, I thought RILA sales would plateau at some point, but they continue to grow. This product is now a teenager, marking its 16th year in the market, yet we are still seeing more carriers entering the market and product sales continuing to climb,” Giesing said.
Fixed annuity sellers saw mixed results in the independent channel. Despite continued attractive crediting rates, FIA sales were down 7% in 2025.
Income annuities sales were down 34%, with other flexible income solutions, such as guaranteed living benefits on other product chassis, being more attractive as a solution for guaranteed income.
Regional/national BDs show mixed results
FIA sales saw a slight slowdown in this channel in 2025, likely as RILA popularity and value proposition outweighed FIA’s principal protection feature. Sales of FIA products in this channel were down 3% compared to 2024.
“Similar to other channels, income annuities experienced challenges in 2025. Sales were down nearly a third from 2024, as the focus on guaranteed income took a back seat to protection and flexibility.” Giesing said.
RILA sales continued to shine in this channel, with sales experiencing the largest percentage increase of any product type. Traditional variable annuity sales saw modest growth in 2025, increasing 3%. In 2025, just over one-fifth of sales in this channel were traditional VA products.
Wirehouse sales grow faster
When compared to other channels, wirehouses had a more balanced sales mix across annuity product types. Sales in the wirehouse channel experienced the highest growth among all channels, with total sales increasing by 18% in 2025.
Consistent with the other channels, RILA sales experienced the highest growth rate. While wirehouses also have competing alternative products to RILAs (such as structured notes) sales of RILAs increased 37% in 2025.
Traditional VA sales remain a staple for this channel, accounting for a 30% market share in 2025. With strong equity market performance in 2025, sales increased 28%.
FRDs saw modest growth at wirehouses in 2025, as attractive crediting rates during the year were an alternative to other fixed-income options available. Sales of FRD products accounted for a third of annuity sales in this channel. Wirehouse FIA sales also increased during 2025, making it the only institutional channel seeing growth in this category. Sales were up an impressive 17%, likely as higher interest rates supported strong guaranteed income solutions in this product line.
Income annuities were challenged in this channel as sales declined 10% in 2025.
Continued growth projected for 2026
Looking ahead to the coming year, Giesing said economic factors are the biggest drivers in annuity sales. “Over the last several years, we’ve seen a favorable environment with elevated interest rates leading to strong returns without much downside risk.”
“If we see declining interest rates or volatility in the equity markets, this likely will negatively impact annuity sales,” he said.
The “money in motion” phenomenon is another major influence on the individual annuity market. Over the past five years, more than $600 billion has been sold in fixed-rate deferred annuities across the industry.
Many of these products have terms of five years or less, meaning that both advisors and investors will need to consider future solutions as contracts mature.
“While some of this money is expected to move into non-annuity investment options, much of it—particularly from nonqualified fixed-rate deferred annuities sold in recent years—will likely shift to new annuity products to retain tax-deferred benefits,” Giesing notes.
“We expect the momentum in the institutional annuity markets to persist throughout 2026. I think 2026 could be another record-breaking year for annuities,” Giesing said.
Only 38% of affluent investors are comfortable with artificial intelligence, according to Cerulli Edge-U.S. Retail Investor Edition.
This comes at a time when, as Cerulli pointed out, AI is used by provider firms as a back-end function for client meetings or for review of documents.
And a Million Dollar Round Table survey found AI is becoming more popular with Americans in both personal and professional settings – including financial advising.
In fact, the MDRT survey noted that 70.8% of U.S. consumers who have an advisor think that advisors should use AI for at least one professional purpose. And using AI for smaller tasks is the safest way for advisors to avoid concern among clients.
Americans’ comfort level with AI
The MDRT survey also pointed out that Americans are the most comfortable with advisors using AI to automate tasks, such as conducting research, developing meeting summaries, etc., with 54.4% of Americans saying they agree they’re comfortable with it, including 70.7% of Americans with advisors.
On the other hand, MDRT found many Americans are not comfortable with advisors using AI for tasks that require more personal information. Across generations, 41.9% of Americans said that they are not comfortable with advisors using AI to provide tailored financial advice, although women and men do not agree on the subject.
Expanding the use of AI
But there is potential to expand the use of AI to include investment analysis, financial planning and asset mapping, Cerulli said. As providers increasingly look to AI for these functions, they must also work to assuage clients’ concerns about AI as part of their advisor relationships.
Affluent investors’ comfort level
As mentioned earlier, the Cerulli report said that only 38% of affluent investors are at least somewhat comfortable with AI technology. This percentage is roughly equal to the 39% who said the same in 2024, Cerulli pointed out. While younger investors are the most supportive of AI in their financial relationships — more than 60% of those under age 50 said they are comfortable — that level of support drops sharply among those investors who are in their 50s (to 42%), and the number is down to 16% among those who are age 70 and older.
“There seems to be little doubt that AI has the potential to make the financial services industry significantly more efficient,” said John McKenna, research analyst at Cerulli. “Currently, the emphasis is on non-value-added tasks, such as client meeting setup, note-taking and document review. However, broader adoption across the advisor-client relationship may be in the works,” he added.
Reasons for the low levels of comfort
Why do so many affluent investors have such low levels of comfort with AI? “The reason for the low levels of comfort is very similar to why comfort with online-only investment advice is so low,” explained McKenna. “It is that people place more trust in a human financial advisor than in outsourcing it to pure technology. AI is still very nascent, so there are a lot of concerns regarding its accuracy in delivering information, as well as how it may be used in a financial advice relationship.”
“When people pay for a financial advisor,” McKenna continued, “they are looking for a person on the other end of the table to talk to and get advice from that is tailored to their situation, something that is not readily replaced by an online-only service, let alone one powered by artificial intelligence.”
Helping AI play a role in business operations
What steps can financial advisors take with their affluent clients to help AI play a role in their business operations? “Advisors are increasingly adopting artificial intelligence tools into their practice, especially regarding note-taking and automating back-office tasks like client scheduling or document summary,” McKenna said. “By automating more of these tasks, it should help them scale their operations more efficiently and spend more time interacting with and helping their clients,” he added.
Florida’s recent tort reforms were designed to reduce lawsuit incentives and the additional costs that arise when claim payouts increase because of societal and legal pressures.
“They’re meaningful because they target the main factors driving higher claim costs—attorney-fee leverage, bad-faith exposure, and long-tail litigation timelines,” said Jay Robinson, division leader for the Southeast at World Insurance Associates.
However, the reforms still preserve the ability to seek compensation for legitimate claims.
“The tradeoff is that some claimants may face higher friction (and less attorney appetite) for smaller or more disputed claims,” Robinson added.
Why Florida enacted tort reforms
Not only do excess tort costs drive higher insurance and healthcare costs, they also discourage economic development. The reforms in Florida aim to address these issues by reducing unnecessary litigation and balancing the justice system.
The most significant outcome is a reset of litigation leverage — particularly through limits on property insurance disputes and tighter standards and timelines in negligence cases.
“Hopefully, this will translate into fewer opportunistic suits, faster claim resolution incentives, and better predictability for carriers and reinsurers. The impact of those changes won’t happen overnight, though. They will take time,” Robinson explained.
These reforms address the costs and long-term risks that come with litigation.
“For property, they’ve reduced incentives tied to the assignment of benefits and one-way attorney fees, which were associated with elevated claim litigation. For casualty, the changes are expected to lower the frequency and severity of large verdicts,” Robinson said.
This would ultimately improve underwriting results, reduce reinsurance pressure, attract capacity back to the state, and support a moderation in rate filings. Florida homeowners pay an average of $5,838 per year for full-service premiums, 142% higher than the national average, according to Bankrate.com.
While early indicators cited by industry groups suggest litigation volume has fallen and some insurers have pursued rate decreases, it’s important to separate litigation-driven changes from catastrophe-driven loss trends, such as hurricanes or inflation in labor and materials.
“The most noticeable impact on claim severity will initially appear in liability lines, as verdicts and settlements adjust, and in property, as fewer claims escalate into attorney-driven disputes,” Robinson explained.
When it comes to premiums, catastrophe exposure still dominates pricing, so tort reform is not a “quick fix.” However, by reducing litigation and frictional costs while improving carrier profitability, reforms can slow the pace of increases.
They can also encourage more competition and availability while stabilizing reinsurance costs that ultimately affect retail rates.
Translating legal changes into practical guidance
The goal of advisors is to translate “legal-system” changes into practical insurance implications.
“That includes explaining how reforms may affect claim handling timelines, documentation expectations, settlement dynamics, and premium and availability trends. Communication with clients that sets expectations around the changes will always be important,” Robinson said.
Benefits to clarify with clients include potentially fewer lawsuits, more predictable outcomes, improved carrier stability, and moderation of litigation-driven costs. The challenges? Clients may hear conflicting media narratives. Savings may take time, and catastrophe risk and inflation could overwhelm any litigation savings.
“Using plain-language and anecdotal examples is a good idea. It helps to share examples specific to the client’s industry,” Robinson explained.
Advisors should also anticipate and prepare for questions, such as:
Will my premiums go down—and when?
Does this change how quickly my claim will be paid or settled?
Will it affect my right to sue or recover damages?
What should I do differently after a loss?
While answering them, focus on providing balanced, practical guidance. Additionally, remind clients that while reforms are intended to reduce litigation pressures and support a more stable insurance marketplace, they’re only one part of a much broader set of factors that influence insurance costs and availability.
Despite several high-profile lawsuits and continued market turbulence, indexed life insurance remains the preferred product for consumers.
Indexed life sales for the fourth quarter were $918.9 million, up 20% compared with the previous quarter, and up 6.2% compared to the record set in Q4 2025, Wink Inc. reported in its Sales & Market Report. Total 2025 indexed life sales were $3.2 billion.
Indexed life sales set both a quarter and yearly record, Wink found. Transamerica Life’s Financial Foundation IUL II, an indexed universal life product, was the No. 1 selling product for all life sales, for all channels combined, for the third consecutive quarter, Wink said.
“Indexed life sales have been setting records since a lull in 2020,” said Sheryl J. Moore, CEO of both Moore Market Intelligence and Wink Inc. “I am intrigued on how recent litigation will impact sales, going forward.”
IUL sellers are currently facing a wave of legal challenges centered on allegations of misleading marketing and unrealistic performance illustrations. In February, Pacific Life agreed to a $58.3 million settlement to resolve a lawsuit claiming it used deceptive illustrations to sell policies, shortly followed by a private settlement with NASCAR champion Kyle Busch, who alleged losses of over $8.5 million.
Meanwhile, National Life Group is defending a renewed lawsuit in Vermont where plaintiffs label its proprietary indices a “fraudulent sham” for using back-tested data that fails to match real-world 0% returns.
All life insurance sales for the fourth quarter were over $3.2 billion, up 14.9% compared to the previous quarter and up 3.2% compared to the same period last year. Total 2025 sales of all life insurance were $11.7 billion. All life sales include fixed universal life, indexed UL, variable UL, indexed whole life, whole life and term life product sales.
Courtesy of Wink, Inc.
Massachusetts Mutual Life Companies ranked as No. 1 in overall for all life sales, with a market share of 6.8%, Wink reported.
Wink’s full life insurance breakdown for Q4 and the full year, by product category:
All universal life sales for the fourth quarter were over $1.3 billion, up 20.9% compared to the previous quarter and up 5.2% compared to the same period last year. Total 2025 sales of all universal life products were $4.8 billion. All universal life sales include fixed UL, indexed UL, and variable UL product sales.
Noteworthy highlights for all universal life sales in the fourth quarter included Pacific Life Companies ranking as No. 1 in overall sales for all universal life sales, with a market share of 12.5%.
Courtesy of Wink, Inc.
Non-variable universal life sales for the fourth quarter were $1 billion, up 20.3% when compared to the previous quarter and up 5.6% compared to the same period last year. Total 2025 non-variable UL sales were $3.5 billion. Non-variable universal life sales include both fixed UL and indexed UL product sales.
Noteworthy highlights for total non-variable universal life sales in the fourth quarter included National Life Group retaining the No. 1 overall sales ranking for non-variable universal life sales, with a market share of 14%.
Courtesy of Wink, Inc.
Fixed universal life sales for the fourth quarter were $88 million, up 21.2% compared to the previous quarter and down 0.6% compared to the same period last year. Total 2025 fixed UL sales were $309.8 million.
Items of interest in the fixed UL market included Nationwide retaining its No. 1 ranking in fixed universal life sales, with a 18.4% market share; Prudential, Pacific Life Companies, John Hancock, and Thrivent Financial completed the top five, respectively.
Pacific Life’s PL Promise GUL was the No. 1 selling fixed universal life insurance product, for all channels combined, for the quarter. The top primary pricing objective, with a no-lapse guarantee, captured 34.1% of sales. The average fixed UL target premium for the quarter was $8,765, an increase of more than 19% from the prior quarter.
Courtesy of Wink, Inc.
Indexed life sales for the fourth quarter were $918.9 million, while total 2025 indexed life sales were $3.2 billion. The record-setting year for indexed life sales topped the prior 2024 record by 8.1%. Indexed life sales include both indexed UL and indexed whole life.
Items of interest in the indexed life market included National Life Group retaining its No. 1 ranking in indexed life sales, with a 15.3% market share; Pacific Life Companies, Transamerica, John Hancock and Nationwide rounded out the top five, respectively.
Transamerica Life’s Financial Foundation IUL II was the No. 1 selling indexed life insurance product, for all channels combined, for the fifth consecutive quarter. The top primary pricing objective for sales in the quarter was cash accumulation, capturing 73.8% of sales. The average indexed life target premium for the quarter was $13,293, an increase of nearly 7% from the prior quarter.
Courtesy of Wink, Inc.
Variable universal life sales for the fourth quarter were $391 million, up 22.4% compared with the previous quarter and up 4.3% compared to the same period last year. Since Wink began tracking sales of these products in 2024, it was a record-setting quarter for variable universal life sales, topping the prior 4th quarter, 2024 record by 4.3%.
Total 2025 variable UL sales were $1.2 billion. It was also a record-setting year for variable universal life sales, topping the prior 2024 record by 5.3%.
Items of interest in the variable universal life market included Prudential retaining the No. 1 ranking in variable universal life sales, with a 28.1% market share; John Hancock, Pacific Life Companies, Nationwide and Lincoln National Life completed the top five, respectively.
Pruco Life’s Prudential FlexGuard Life IVUL was the No. 1 selling variable universal life product, for all channels combined for the quarter. The top primary pricing objective for sales this quarter was cash accumulation, capturing 76.6% of sales. The average variable universal life target premium for the quarter was $25,659, an increase of nearly 14% from the prior quarter.
“No doubt that variable UL sales will be down in 2026,” explained Moore. “Volatility in the markets usually translates to declining sales of both variable annuities and variable UL.”
Courtesy of Wink, Inc.
Whole life fourth quarter sales were over $1.2 billion, up 17.4% compared with the previous quarter, and up 6.1% compared to the same period last year. Total 2025 whole life sales were $4.5 billion. Items of interest in the whole life market included the top primary pricing objective of final expense, capturing 70.2% of sales. The average premium per whole life policy for the quarter was $4,786, an increase of more than 20% from the prior quarter.
Courtesy of Wink, Inc.
Term life fourth quarter sales were $565.2 million, down 1.6% compared with the previous quarter and down 6.4% compared to the same period last year. Total 2025 term life sales were $2.3 billion.
Items of interest in the term life market include Pacific Life Companies ranking as No. 1 in term life sales, with a 5.5% market share. Prudential, Corebridge Financial, Protective Life Companies and National Life Group completed the top five, respectively.
Pacific Life’s Promise Term 20 was the No. 1 selling term life insurance product, for all channels combined, for the quarter. The average annual term life premium per policy reported for the quarter was $2,678, an increase of more than 20% from the previous quarter.
Courtesy of Wink, Inc.
Wink now reports sales on all annuity lines of business, as well as all life insurance product lines.
