The investment function is extremely important in the overall operations of insurance companies. Because premiums are paid in advance, they can be invested until needed to pay claims and expenses.
Assets held by life insurers have increased substantially over time. In 2013, U.S. life insurers held $6.15 trillion in assets (see Exhibit 6.2). The funds available for investment are derived primarily from premium income, investment earnings, and maturing investments that must be reinvested.