The average market risk premium in the United States decreased slightly to 5.5 percent in 2023. This suggests that investors demand a slightly lower return for investments in that country, in exchange for the risk they are exposed to. This premium has hovered between 5.3 and 5.7 percent since 2011. What causes country-specific risk? Risk to investments come from two main sources. First, inflation causes an asset’s price to decrease in real terms. A 100 U.S. dollar investment with three percent inflation is only worth 97 U.S. dollars after one year. Investors are also interested in risks of project failure or non-performing loans. The unique U.S. context Analysts have historically considered the United States Treasury to be risk-free. This view has been shifting, but many advisors continue to use treasury yield rates as a risk-free rate. Given the fact that U.S. government securities are available at a variety of terms, this gives investment managers a range of tools for predicting future market developments.

Graph and download economic data for Real Risk Premium (TENEXPCHAREARISPRE) from Jan 1982 to May 2025 about premium, real, and USA.

The average market risk premium in Canada was 5.2 percent in 2024. This means investors demanded an extra 5.2 Canadian dollars on a 100 Canadian dollar investment. This extra cost should compensate for the risk of an investment based in Canada. What causes risk? As far as country-specific factors are concerned, macroeconomic trends can cause risk. For example, the inflation rate in relation to other countries can change the relative value of an investment. Lower inflation in Canada could weaken the Canadian dollar, reducing the value of Canadian assets in terms of another currency, such as the euro or U.S. dollar. The Canadian context As a country, Canada has a fairly high national debt. Some economists point to this as an increased default risk, since debt servicing can become costly. However, most investors agree that Canada, as an advanced economy, is creditworthy and not at risk of defaulting. A better measure is to look at Canada’s risk premium in the context of interest rates from other countries. These deposit rates can be used as a baseline for the market risk premium of other countries, though they do not include all the factors that have been used to calculate this statistic.

The average market risk premium in South Africa increased to 8.3 percent in 2024. Market premium risk represents the difference between return on equities and a risk-free investment, which is normally associated with short-term government bonds. For comparison, the U.S. market premium risk amounted to 5.5 percent in the same year. Risk-free rate Most analysts consider the U.S. treasury rate to be the risk-free rate for the term of their investment, assuming the United States government will not default. Just as consumers in the Unites States get a credit rating, agencies such as Standard & Poor’s rate countries’ credit risks. Using these data, analysts compute the country-specific default risk, which in turn has an influence on the value of risk-free rate. What influences the return on equities? The economic factors such as political stability in a country, inflation rate, level of indebtment, trade deficit and investments have an influence on the activities of companies and their valuation on the stock exchanges. Apart from the economic cycle, the company’s operations itself, which are reflected in the results published in the financial reports, can boost or diminish the stock returns.

This statistic illustrates the average market risk premium used for selected countries worldwide in 2024. The average market risk premium used in Turkey was the highest and reached a value of 16.5 percent in that year.

United States US: Risk Premium on Lending: Lending Rate Minus Treasury Bill Rate data was reported at 3.186 % pa in 2016. This records a decrease from the previous number of 3.201 % pa for 2015. United States US: Risk Premium on Lending: Lending Rate Minus Treasury Bill Rate data is updated yearly, averaging 2.868 % pa from Dec 1960 (Median) to 2016, with 57 observations. The data reached an all-time high of 4.793 % pa in 1981 and a record low of 0.587 % pa in 1965. United States US: Risk Premium on Lending: Lending Rate Minus Treasury Bill Rate data remains active status in CEIC and is reported by World Bank. The data is categorized under Global Database’s United States – Table US.World Bank.WDI: Interest Rates. Risk premium on lending is the interest rate charged by banks on loans to private sector customers minus the 'risk free' treasury bill interest rate at which short-term government securities are issued or traded in the market. In some countries this spread may be negative, indicating that the market considers its best corporate clients to be lower risk than the government. The terms and conditions attached to lending rates differ by country, however, limiting their comparability.; ; International Monetary Fund, International Financial Statistics database.; ;

Market risk premiums (MRP) measure the expected return on investment an investor looks to make. For potential investors looking to add to their portfolio, the perfect scenario for a risk-based investment would be a high rate of return with as small a risk as possible. There are three main concepts to MRP’s, including required market risk premiums, historical market risk premiums and expected market risk premiums. United Kingdom shows little return for risk Europe wide, Finland had one of the lowest MRP alongside Poland and Germany. Ukraine had average risk premiums of 22.6 percent in 2024. Having a lower market risk premium may seem bad, but for countries such as the UK and Germany where rates have been consistent for several years, it is because the market is stable as an environment for investment. Risk free rates Risk free rates are closely associated to market risk premiums and measure the rate of return on an investment with no risk. As there is no risk associated, the rate of return is lower than that of an MRP. Average risk free rates across Europe are relatively low.

Split into three categories (required, historical, expected), market risk premiums measure the rate of return investors expect on an investment over the risk that investment holds. In Europe, average market risk premiums (MRP) sit between five and ten percent.

Greece sees hike in MRP

Although it has a relatively high market risk premium, Greece has seen its rates significantly decrease since 2020. Greece also saw a higher than average return rate on risk free investments. The same correlation can be seen with Europe’s less risky countries for investment. With Germany seeing some of the lowest market risk premiums and risk free returns in Europe.

Required, historical and expected

Separating the three types of market risk premiums is straightforward. Required MRP’s differ between investors, as approaches to investment change and measure the rate of return needed for an investment to be made. Expected premiums look at the rate of return, and what they are calculated to come out as, while historical MRP’s look back over a period at the average rate of return that investors previously got in the past.

Graph and download economic data for Term Premium on a 10 Year Zero Coupon Bond (THREEFYTP10) from 1990-01-02 to 2025-05-30 about term premium, 10-year, bonds, and USA.

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Foreign Exchange Market Size 2025-2029

The foreign exchange market size is forecast to increase by USD 582 billion at a CAGR of 10.6% between 2024 and 2029.

The market is experiencing significant growth, driven by the global trend of increasing urbanization and the 24x7 trading opportunities it affords. The digitalization of financial services has enabled seamless transactions across borders, making foreign exchange more accessible than ever before. One significant trend is the increasing use of money transfer agencies, venture capital investments, and mutual funds in foreign exchange transactions. However, this market is not without challenges. Regulatory hurdles impact adoption in some regions, with stringent regulations and compliance requirements adding complexity to market entry. Furthermore, the uncertainty of future exchange rates poses a significant risk for businesses engaging in foreign exchange transactions.
Navigating these challenges requires a deep understanding of market dynamics and a strategic approach to risk management. Companies seeking to capitalize on the opportunities in the market must stay informed of regulatory changes and adopt advanced risk management techniques to mitigate the impact of exchange rate volatility. By doing so, they can effectively capitalize on the growth potential of this dynamic market.

What will be the Size of the Foreign Exchange Market during the forecast period?

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The market, also known as FX, plays a crucial role in global business operations and finance. FX market liquidity is essential for effective portfolio management, mitigating interest rate risk, and facilitating cross-border transactions. FX analysis involves various tools and techniques, including technical analysis using moving averages, chart patterns, and stochastic oscillators, as well as fundamental analysis focusing on economic indicators and sentiment. Interest rate differentials drive currency appreciation and influence FX trading, with foreign exchange swaps enabling the exchange of principal and interest between two different currencies. Market orders facilitate instant execution, while trading platforms offer advanced features such as automated trading robots and AI-driven systems.
FX market impact is a critical consideration, with operational risk and compliance essential in managing currency exposure and hedging strategies. Currency risk and FX forward rates are vital components of FX risk management, while FX trading apps and discipline help maximize profit and minimize psychological biases. FX trading systems employ various tools like FX charts, indicators, and exchange-traded derivatives to analyze trends and forecast future movements. Cryptocurrency trading has also emerged as a significant component of FX markets, adding complexity and volatility to the market structure. FX trading Blockchain Technology offers potential benefits, such as increased transparency and reduced counterparty risk.

How is this Foreign Exchange Industry segmented?

The foreign exchange industry research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in 'USD billion' for the period 2025-2029, as well as historical data from 2019-2023 for the following segments.

Type

  Reporting dealers
  Financial institutions
  Non-financial customers


Trade Finance Instruments

  Currency swaps
  Outright forward and FX swaps
  FX options


Trading Platforms

  Electronic Trading
  Over-the-Counter (OTC)
  Mobile Trading


Geography

  North America

    US
    Canada


  Europe

    Germany
    Switzerland
    UK


  Middle East and Africa

    UAE


  APAC

    China
    India
    Japan


  South America

    Brazil


  Rest of World (ROW)

By Type Insights

The reporting dealers segment is estimated to witness significant growth during the forecast period.

In het market, dealers manage risky inventory positions during the maturity period, earning returns through liquidity provision. These returns reflect the risk premium associated with non-diversifiable risks. Dealers employ trading strategies using customer trade information to generate higher-than-expected returns. Competition among liquidity providers is expected to maintain stable pricing during the forecast period. Reporting dealers offer inter-day liquidity, buying and selling foreign exchange at posted bids while providing quotes throughout the trading day. Trading in the market involves various financial instruments and tools. Market orders are executed at the prevailing market price, while limit orders are executed at a specified price.

Forex brokers facilitate transactions between buyers and sellers, providing access to various trading tools such as currency baskets and exchange-traded derivatives. Cross-currency pairs are used for hedging and speculation, with the value of one curre

Brazil Insurance: Current Risk not Issued: Housing Insurance in Market Policies Moneylender data was reported at 610,522.390 BRL in Dec 2024. This records an increase from the previous number of -91,099.170 BRL for Nov 2024. Brazil Insurance: Current Risk not Issued: Housing Insurance in Market Policies Moneylender data is updated monthly, averaging 16,908.620 BRL from Dec 2013 (Median) to Dec 2024, with 133 observations. The data reached an all-time high of 3,318,092.510 BRL in Feb 2014 and a record low of -18,583,746.050 BRL in Nov 2015. Brazil Insurance: Current Risk not Issued: Housing Insurance in Market Policies Moneylender data remains active status in CEIC and is reported by Superintendence of Private Insurance. The data is categorized under Brazil Premium Database’s Insurance Sector – Table BR.RGB011: Premium: Current Risk not Issued.

Abstract (en): This paper develops a production-based asset pricing model with two types of agents and concentrated ownership of physical capital. A temporary but persistent "distribution shock" causes the income share of capital owners to fluctuate in a procyclical manner, consistent with US data. The concentrated ownership model significantly magnifies the equity risk premium relative to a representative-agent model because the capital owners' consumption is more-strongly linked to volatile dividends from equity. With a steady-state risk aversion coefficient around 4, the model delivers an unleveled equity premium of 3.9 percent relative to short-term bonds and a premium of 1.2 percent relative to long-term bonds. (JEL D31, E13, E25, E32, E44, G12)

The industry has benefited from economic growth, favorable legislation and positive trends in the insurance sector for most of the period. The industry includes insurance brokers representing the buyer instead of the insurance company and agencies representing various insurance companies during the purchasing process. The industry is vital to the larger insurance sector as operators act as intermediaries between insurance providers and downstream clients. Operators generate income via commissions earned on policies sold. As a result, industry revenue grows as policy prices and volumes increase. The industry has grown for several reasons. One such reason was rising premium prices on policies sold to consumers. Thanks to rising disposable income and favorable legislative trends, consumers weren’t deterred by rising premium prices and continued to purchase insurance products. The adverse economic effects of high inflation in the latter part of the period have restricted industry revenue growth as consumers and businesses have limited spending on insurance premiums. However, in 2024, inflationary pressures have eased and the Fed has cut interest rates, supporting industry growth as consumers and businesses can spend more on insurance premiums. The Fed is anticipated to cut rates further in 2025 but will monitor various economic data points before deciding on rate cuts. Overall, revenue grew at a CAGR of 1.5% to $234.8 billion over the past five years, including an expected climb of 1.3% in 2025 alone. Industry profit is expected to remain at 18.2% of revenue in the same year. Moving forward, the industry is anticipated to continue its steady growth rate as the overall economy improves despite high inflation, which is expected to linger as further rate cuts will support industry demand. Macroeconomic growth will lead to per capita disposable income growth during the outlook period, enabling consumers to afford goods that require insurance policies like automobiles and personal policies like private health and life insurance. Also, the business sentiment index is expected to climb despite persistently high inflation, leading to higher demand for brokerage of commercial lines of insurance. Inflationary pressures are expected to ease, boosting industry growth as consumers increase spending and demand shifts toward specific insurance niches. Overall, revenue is expected to rise at a CAGR of 0.9% to an estimated $245.9 billion over the five years to 2030.

The U.S. dollar was the most common currency in foreign exchange reserves in 2023, comprising more than three times the amount of the euro in global reserves that year. This total peaked in 2015, partly due to the strength of the dollar during the Eurozone crisis. The share of the U.S. dollar has lost since to the Japanese yen and euro, as well as other currencies. Why do foreign exchange reserves matter? When countries with different currencies export goods, they must agree on a currency for payment. As a result, countries hold currency reserves worth trillions of U.S. dollars. After World War II, the U.S. dollar itself became the international currency in the Bretton Woods Agreement and is thus the most common currency for international payments. The United States Treasury is also seen by most as risk-free, giving the country a low-risk premium. For this reason, countries hold U.S. dollars in reserve because the currency holds value relatively well eventually. China and currency reserves Since 2016, the International Monetary Fund has included the Chinese renminbi (yuan) as part of the Special Drawing Rights (SDR) basket. This decision recognized the influence of the renminbi as a reserve currency, particularly in several Asian countries. China also holds significant foreign exchange reserves itself, funded by its large positive trade balance.

General insurers can provide industry services at a fraction of the potential loss by pooling premiums to pay for losses some policyholders incur. The industry is an indispensable part of risk management in the domestic economy. General insurers derive income from insurance premiums and investing in bonds, stocks and other assets. Most property and casualty premiums are obtained through renewing policies relating to existing risks. Changes in risk exposure and pricing conditions affect remaining premiums. Many consumers view policies as inelastic, although some may choose to decrease consumption of insurance policies should premium prices increase too much. Policy pricing fluctuates between cycles of price-cutting (softening) and price raising (hardening). Over the past five years, revenue has grown at a CAGR of 3.4% to $1,021.1 billion, including an expected 2.1% increase in 2025 alone. Industry profit is also set to climb to 14.2% of revenue in the current year as insurance premiums have climbed and interest income has grown. Industry revenue has benefited from a hardening price cycle during the majority of the current period. Even though volatility at the onset of the period and a high inflationary environment in the latter part of the period hindered the broader economy, demand for industry services was not severely damaged. Net premiums increased for insurers, primarily because of the growth in the house price index and the rise of new car sales have led to higher insurance premiums to protect against potential liabilities. As economic conditions will continue to improve into the outlook period, employment and business activity in the broader economy are expected to increase and promote spending and the need for industry services. The Federal Reserve is anticipated to cut rates further following the recent rate cuts in the latter part of the period which will decrease investment income for P&C insurers, limiting industry revenue growth. Overall, revenue is forecast to grow at a CAGR of 2.0% to $1,126.8 billion over the five years to 2030.

Insurance: Current Risk not Issued: Housing Insurance in Market Policies Moneylender在2025-02达-47,980.580BRL，相较于2024-12的610,522.390BRL有所下降。Insurance: Current Risk not Issued: Housing Insurance in Market Policies Moneylender数据按月度更新，2013-12至2025-02期间平均值为15,876.170BRL，共134份观测结果。该数据的历史最高值出现于2014-02，达3,318,092.510BRL，而历史最低值则出现于2015-11，为-18,583,746.050BRL。CEIC提供的Insurance: Current Risk not Issued: Housing Insurance in Market Policies Moneylender数据处于定期更新的状态，数据来源于Superintendence of Private Insurance，数据归类于Brazil Premium Database的Insurance Sector – Table BR.RGB011: Premium: Current Risk not Issued。

A little over half of investors believe the risk premium of seniors housing in the United States will increase in the next 12 months, according to a June 2022 survey. In this case, the risk premium refers to the spread between the risk-free 10-Year Treasury and seniors housing cap rates. The average United States risk market premium has hovered between 5.3 and 5.7 percent since 2011.

Personal Accident Insurance Market Outlook

The global market size for Personal Accident Insurance in 2024 stood at approximately USD 152 billion and is projected to reach nearly USD 245 billion by 2033, growing at an impressive CAGR of 5.6%, which is being fueled by increased consumer awareness and a deeper understanding of the need for comprehensive coverage. This industry has seen rapid transformation over the years as more individuals and corporate entities recognize the benefits of securing financial protection against unforeseen accidents. In recent times, there has been a substantial boost in policy adoption due to the rising frequency of accidental injuries and an increasing societal focus on health and wellness. Market dynamics have shifted as more insurers enhance their product portfolios with customizable personal accident policies that cater to both individual and group needs, leading to an expansive array of coverage options and distribution channels. This market has also benefited from technological advancements that streamline policy underwriting and claims management, which has created an environment of trust and reliability among consumers. In addition, changing lifestyles, urbanization, and an increasing number of multi-risk exposures have played crucial roles in steering the market towards robust growth. The evolution of customer behavior and improvements in digital processes have also added layers of convenience, thereby encouraging policy purchase and renewal. Moreover, insurers are leveraging data analytics and artificial intelligence to assess risk more accurately, optimize premiums, and offer targeted benefits, which has further reinforced consumer confidence. Factors such as these not only contribute to the current market performance but also lay the groundwork for future expansion, making the Personal Accident Insurance Market a focal point for industry players. The steady growth, innovative product offerings, and the shift towards digital distribution are key indicators of the resilience and adaptive nature of this market.

The growth factors influencing the Personal Accident Insurance Market have been multifaceted, driven by both macroeconomic trends and specific industry advancements. One of the primary growth drivers has been the increased consumer awareness regarding personal safety and financial security, resulting in a larger segment of the population actively seeking policies that mitigate financial loss from accidents. This has been complemented by the rise of urbanization and an expanding middle class in emerging economies that now have access to a wide range of insurance products, resulting in a significant uplift in policy uptake. Additionally, evolving regulatory frameworks have compelled insurance providers to innovate and extend their coverage, making policies more inclusive and adaptable to individual needs, which in turn bolsters market growth. The integration of digital technology in insurance distribution channels has further accelerated policy adoption among tech-savvy customers who value convenience and transparency. With insurers continually investing in advanced analytics to predict risk and customize pricing, the market has witnessed a more dynamic pricing model that aligns well with consumer expectations. There is also a notable shift toward bundled insurance offerings that combine accident coverage with other forms of protection, adding further value for customers. Furthermore, the heightened focus on safety measures at workplaces and in public domains has indirectly pushed the market towards greater prominence as organizations seek to protect their employees through group policies. With multifarious drivers in play, the market remains highly responsive to both internal improvements and external economic shifts, ensuring that its evolutionary path is well-supported by strategic initiatives and technological innovations.

The momentum in the market has also been significantly augmented by improved penetration strategies and innovative distribution models. Insurance companies have re-engineered their outreach approaches by leveraging both traditional and digital channels, which has led to more comprehensive customer engagement and higher conversion rates. The introduction of user-friendly online platforms, backed by robust analytics, has enabled potential customers to explore, compare, and purchase policies with ease, thereby widening the base of insured individuals. Furthermore, partnerships between technology firms and insurance companies have led to the creation of advanced risk assessment tools that have reduced underwriting times and improved customer satisfaction. The confluence of regulatory incentives and evolving market conditions has spurred companies to invest heavily in research and deve

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Insurance Market Size 2025-2029

The insurance market size is forecast to increase by USD 1461.5 billion, at a CAGR of 4.3% between 2024 and 2029.

The market is experiencing significant shifts driven by increasing government regulations mandating comprehensive insurance coverage in developing countries and the integration of wearable technology into customer engagement metrics for life insurance software. This regulatory push is expanding insurance penetration in emerging economies, creating new opportunities for growth. Simultaneously, insurers are leveraging wearables to offer personalized policies and improve risk assessment, enhancing customer experience and loyalty. However, the market faces challenges from a tightening regulatory environment. Compliance with evolving regulations is becoming increasingly complex, requiring substantial resources and expertise. Insurers must navigate these regulatory hurdles effectively to maintain market competitiveness.
Additionally, the integration of technology into insurance operations necessitates significant investments in IT infrastructure and cybersecurity measures, adding to operational costs. In response, insurers are exploring partnerships and collaborations to share resources and expertise, enabling them to adapt to regulatory changes and invest in technology more efficiently. Furthermore, insurtech startups are disrupting traditional business models by offering digital solutions that cater to the evolving customer needs and expectations. Insurers must innovate and collaborate to capitalize on these opportunities and overcome the challenges effectively.

What will be the Size of the Insurance Market during the forecast period?

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The market continues to evolve, with dynamic market dynamics shaping various sectors. Travel insurance and individual insurance policies adapt to shifting consumer preferences and emerging risks. Claims history informs risk management strategies, while insurance awareness campaigns promote financial literacy. Insurance technology, or insurtech, revolutionizes claims processing through machine learning and digital platforms. Fraud detection systems employ advanced analytics to mitigate risks. Risk assessment and mitigation strategies are integral to actuarial science, liability insurance, and policy administration. Catastrophe modeling and coverage limits adapt to climate change and natural disasters. Long-term care insurance, life insurance, business insurance, and health insurance undergo continuous transformation.

Direct-to-consumer (D2C) distribution channels expand, while insurance brokerage and regulation adapt to digital trends. Artificial intelligence and investment management optimize financial reporting and predictive modeling. Policy coverage and claims management evolve to meet changing consumer needs. Group insurance and disability insurance adapt to the evolving workforce. The insurance landscape is shaped by ongoing market activities and the unfolding of patterns. Continuous innovation in areas such as risk assessment, risk mitigation, and fraud detection ensures the industry remains responsive to emerging trends and challenges.

How is this Insurance Industry segmented?

The insurance industry research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in 'USD billion' for the period 2025-2029, as well as historical data from 2019-2023 for the following segments.

Distribution Channel

  Sales personnel
  Insurance agencies


Type

  Life
  Non-life


Mode

  Offline
  Online


End-user

  Corporate
  Individual


Geography

  North America

    US
    Canada


  Europe

    France
    Germany
    UK


  APAC

    Australia
    China
    India
    Japan
    South Korea


  South America

    Brazil


  Middle East and Africa

    UAE


  Rest of World (ROW) 

By Distribution Channel Insights

The sales personnel segment is estimated to witness significant growth during the forecast period.

In the dynamic market, travel and individual insurance hold significance for consumers seeking protection against unforeseen circumstances. Claims history plays a crucial role in risk management, influencing premiums and underwriting decisions. Insurance awareness is continually evolving, with technology, such as insurtech, revolutionizing claims processing through machine learning and digital platforms. Fraud detection is a pressing concern, necessitating advanced fraud prevention measures. Life, business, and long-term care insurance are essential for individuals and businesses, requiring expert advice from sales personnel. Actuarial science and liability insurance ensure financial security through accurate risk assessment and mitig

The industry has grown over the five years to 2024 due to the growth of global demand for insurance products. The industry provides essential risk management services to downstream consumers and is a vital part of the financial sector, particularly concerning the industry's massive asset holdings. Industry operators protect individuals from current, immediate and long-term illness, injury and death costs. By merging various risks, life and health insurers protect a fraction of the potential loss. The role of life and health insurers has become increasingly important as the global population has aged. Although the industry provides essential products and services, operators are highly susceptible to macroeconomic shocks. Industry revenue is expected to grow at a CAGR of 0.6% to $5.5 trillion over the five years to 2024, including a decrease of 0.3% in 2024 alone. In addition to premiums from insurance underwriting, operators also obtain revenue from financial instruments, such as stocks and bonds, which generate income and capital gains. However, this exposure to financial markets, particularly for life insurers, means that revenue and profit can exhibit significant volatility. The decline in global interest rates has been the primary obstacle to the industry's expansion. Nevertheless, given the immediacy of health concerns, health insurance largely tempers revenue fluctuations for the industry. Market conditions are expected to recover moving forward. Thus, revenue is expected to increase at a CAGR of 0.9% to $5.8 trillion over the five years to 2029. Moreover, increasing employment levels globally are expected to drive demand for insurance. Meanwhile, demand for insurance is growing in emerging markets. As the wealth of these regions continues to grow, individuals will likely become more interested in ensuring their wealth and income against a range of risks. Additionally, the threat of volatile financial markets is anticipated to persist during the period and could hurt investment income, particularly if interest rates are forced to remain low.