At a glance
- The MPL composite's fixed income portfolios earned a lower book yield than the broader P&C industry even though average credit quality and duration were comparable, the report found.
- For a general-account manager at an MPL writer, the gap to larger peers may be as much about risk budget as about market conditions.
- The MPL composite's investment leverage, measured as invested assets to surplus, was broadly in line with the P&C industry.
Net investment income rose in 2025 for a composite of 110 U.S. medical professional liability insurers while falling across the rest of the property and casualty industry, according to a New England Asset Management analysis published in the Insurance AUM Journal.
The MPL composite's fixed income portfolios earned a lower book yield than the broader P&C industry even though average credit quality and duration were comparable, the report found. The income gain did not come from a richer bond book. NEAM's 2025 review, as Private Wealth Daily previously reported, used its own data to show the income line can fall while book yields climb.
For a general-account manager at an MPL writer, the gap to larger peers may be as much about risk budget as about market conditions. More than 90% of the composite holds less than $1 billion in invested assets, and larger MPL insurers that took greater investment risk tended to earn higher book yields.
Within fixed income, the MPL composite was overweight agency residential mortgage-backed securities and underweight tax-exempt municipal bonds and government and agency bonds relative to the P&C industry.
The MPL composite's investment leverage, measured as invested assets to surplus, was broadly in line with the P&C industry. Premium leverage was materially lower and reserves-to-premium ratio higher, consistent with the longer-tailed nature of MPL business, the report said.
The analysis draws on statutory filing data as of Dec. 31, 2025 from S&P Capital IQ Pro, supplemented with NEAM and ICE BofA data. It generally excludes Berkshire Hathaway from the P&C composite to avoid distortion from its outsized equity and alternative allocations. Phil Lee and Eric Huang, enterprise capital strategists at NEAM, wrote the report.
Reported by the Insurer portfolios desk from Insurance AUM Journal. Published . Corrections