Insurance at AB

Delivering Distinctive Solutions

Translating Our Insurance DNA and Culture of Innovation into Better Outcomes… Responsibly

Case Studies

Learn how we’ve partnered with some of our clients to develop the best solutions to meet their needs.

Strategic Portfolio Repositioning

Working closely with a life and annuity insurance company, we followed a comprehensive four-step process to reposition its traditional core portfolio. By incorporating more diversified exposures, including illiquid assets, we enhanced book yield while meeting the client’s objectives.

Process and Methodology

Assess

Define objective: yield, risk budget, duration, liquidity, income
Incorporate investment and noninvestment client constraints into analysis: hedging, regulatory considerations, accounting
Analyze current allocation and create repositioning plan

Develop and Decide

Consultative partnership between client and asset-class experts
Iterative internal allocation process between subject experts
Discuss options to determine optimal Strategic Asset Allocation: stress/scenario testing, relative value, capital impacts, ESG

Review & Execute

Review allocation and adjust based on current market dynamics, subject to guidelines and constraints
Leverage AB’s tech and innovation to take liquidity and market opportunities into account while executing quickly

Outcome

Added 50 b.p. of book yield and compliant with guidelines
Greater diversification: rotated out of munis, US government, IG credit to fund private credit, EMD, high-yield and securitized assets
Enhanced yield with illiquid assets

For illustrative purposes only. There can be no assurance that any investment objectives will be achieved.

Blended Emerging-Market Debt Solution

We worked with a large life insurer that was seeking alternate approaches to increasing its book yield. After assessing the client’s needs, we designed a diversified investment-grade portfolio of emerging-market debt that blended hard-currency corporate and sovereign bonds.

Process and Methodology

Client Discovery, Education and Diligence

Introduced EMD to prospect who was seeking alternative ways to boost book yield while preserving quality. Met and conducted due diligence with AB team over 18- to 24-month span.

Portfolio Construction and Management

Employed iterative process to determine client constraints and diversification requirements; continued due diligence with AB team.

Implementation and Active Management

Produced diversified investment-grade portfolio with blend of hard-currency corporates and sovereigns. Small bucket for opportunistic high yield.

All portfolio statistics, characteristics and holdings are subject to change. There can be no assurance that any investment objectives will be achieved.
As of January 31, 2022