As if insurers weren't depressed enough about the low returns they've been collecting on investments, along comes QE3 to dampen things even more. To add insult to injury, Moody's lowered its outlook on the industry late last week, citing long-term low interest rates as the primary culprit behind the downgrade.
Don't think that these companies are sitting around wringing their hands, however. Sick of not making enough money on traditional investments, some insurers are looking to step up their investments in good, old real estate.
Insurers are sniffing out higher returns in property investment
As vacancy rates remain well below the landlord-friendly 5% mark, the giant insurer sees healthy profits continuing for some time in the apartment rental sector.
Industry giant AIG
The floundering housing market has made rental units a real goldmine, and these insurers are astute in taking advantage of the situation. As insurance CFOs search for more profitable investments in the next few years, the multifamily sector looks to be a good bet to survive the low-interest rate doldrums.
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