AI Longevity Improvements Expected to Boost Life Insurers

Dow Jones09-29 01:00

1300 ET - Life insurance providers should benefit from AI-fueled drug development improving overall life expectancy, Morgan Stanley analysts write in a note. "Given the current state of drug developments, scientific advances and other factors, we expect life expectancy in the US could improve faster than the historical average of 2 years every 10 years," the analysts write, adding that the trend should support earnings per share benefits for life insurers including Globe Life, RGA, Lincoln, MetLife, and Unum. "This is due to lower benefit ratio for various insurers into the outer years as mortality and longevity impacts become more visible," they write. Insurers with more exposure to morbidity and retirement could see a smaller tailwind, they add, as the expected improvement in longevity cuts both ways.

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