Skip to main content

Reply to "Who wins and who loses when the Bank of Canada raises rates"

Life insurance companies

Another sector that’s poised to benefit from rising rates is the insurance industry. Life insurance companies have liabilities that are very long term in nature, but their investments tend to be for much shorter terms.

“Therefore, in a rising interest rate environment, you actually get more return on your assets as they reprice than what you had originally factored in when you wrote the contract,” says Aiken.

That being said, the major Canadian life insurance companies have a greater exposure to U.S. interest rates than to Canadian ones, Aiken notes.

FM
×
×
×
×
×
×