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Insurers primarily rely on steady premium inflows and invest those funds in large portfolios of bonds and other assets rather than depending directly on economic growth or consumer spending. The sector’s performance is therefore driven more by investment income and bond market moves (interest rates and credit spreads) than cyclical revenue swings.

Analysis

Insurers primarily rely on steady premium inflows and invest those funds in large portfolios of bonds and other assets rather than depending directly on economic growth or consumer spending. The sector’s performance is therefore driven more by investment income and bond market moves (interest rates and credit spreads) than cyclical revenue swings.