Private Equity's Insurance Bets Raise Risks, BIS Researchers Say.

Private equity firms have changed the business models of life insurers they invest in, which could pose risks, especially with higher interest rates, according to researchers at the Bank for International Settlements. These firms have been acquiring insurers to gather more capital for alternative assets, which has boosted profits but also made insurers more complex and exposed to illiquid assets. Insurers owned by private equity are twice as likely to invest in assets originated by buyout firms. The researchers emphasize the need for adequate governance frameworks and supervision to address conflicts of interest and manage risks. [Extracted from the article]