The Investment Research Program of the Life Insurance Association of America

Abstract

The life insurance companies are today, and have been historically, one of the principal financial institutions in the United States, along with the commercial banks, the savings and loan associations, the mutual savings banks, and the corporate pension funds. The volume of new savings accumulated by the public through life companies now exceeds $6 billion per annum, and the gross cash flow through life companies for long-term investment (taking account not only of new savings but also repayments on outstanding invested assets and sales of existing assets) amounts to about $15 billion per year. The total savings accumulated through life insurance over the years amounts to $132 billion, the largest aggregate of savings in any single form in the United States. The following figures will serve to illustrate the importance of life insurance savings in financing the nation's economic growth. During the period 1948-1962, inclusive, American business and industrial corporations increased their bonded indebtedness by $68 billion. Of this total, the life insurance companies added $34 billion to their holdings, or 50 per cent of the total. In addition, during the same period the net increase in outstanding mortgage debt on business and industrial