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20 T he savings of Canadians through life and health insurers are channelled into productive investments, and the earnings from insurers' investments help keep down the cost of life and health insurance and guarantee future benefits for policyholders and beneficiaries. The accumulated savings, supporting long- term liabilities, also provide a stable capital source for Canada's economic growth. Assets of life and health insurers By the end of 2013, the total assets held in Canada on behalf of Canadian life and health insurance policyholders amounted to $646.6 billion, up 3.9 per cent for the year. Segregated fund assets rose 14.8 per cent to a new record high of 246.9 billion. At the same time, general fund assets faltered, down 1.9 per cent to $399.7 billion (or 62 per cent of the total). In addition, American life insurers invested $112.8 billion in Canada on behalf of U.S. policyholders. Long-term investments The asset holdings of the companies are managed through prudent and long-term investment strategies and a diligent underwriting process that matches assets to the long-term nature of many industry products in order to mitigate risk and best serve policyholders. This assures that investments of life and health insurers are more than sufficient to cover their obligations to policyholders, such as death claims, annuities, health care and disability income benefits. In 2013, Canada's life and health insurers held more than $570 billion or almost 90 per cent of their total domestic assets in long-term investments. The industry's investments often support longer-term capital Assets and Liabilities ❖ At December 31, 2013, assets held on behalf of Canadian policyholders and annuitants totalled: General funds $399.7 billion Segregated funds 246.9 billion Total $646.6 billion ❖ More than three-quarters of the assets were held in bonds (35.3 per cent), stocks (15.5 per cent) and mutual funds (25.5 per cent). ❖ Actuarial liabilities totalled $517 billion at year-end, making up 80 per cent of total assets. ❖ The remaining assets back items such as other policy liabilities, borrowed funds, as well as capital and surplus. Total Assets Held in Canada (millions) End of Bonds Stocks Mutual Mortgage Real Cash Reinsurance Other Total Year Funds Loans Estate Assets Assets 1960 $ 4,064 $ 257 $ * $ 3,108 $ 294 $ 54 $ * $ 579 $ 8,356 1970 5,909 1,108 * 6,914 737 166 * 1,156 15,990 1980 17,178 5,814 * 16,942 1,862 804 * 3,645 46,245 1990 51,247 14,159 * 46,873 6,716 2,231 * 9,636 130,862 2000 108,593 42,402 37,444 41,323 7,686 16,138 10,333 17,551 281,470 2005 150,465 65,288 68,578 42,302 9,255 15,165 25,452 24,525 401,030 2006 153,686 73,174 85,171 43,008 10,743 16,505 25,598 24,559 432,444 2007 164,189 81,702 94,787 43,747 13,139 13,581 35,102 26,620 472,867 2008 156,202 71,055 82,569 44,800 14,341 17,327 33,251 29,993 449,538 2009 169,206 97,074 109,645 42,998 14,350 19,231 35,037 28,263 515,804 2010 195,186 91,451 129,048 42,748 14,727 16,908 36,166 30,543 556,777 2011 217,688 83,284 127,290 43,148 15,473 18,603 36,506 35,980 577,972 2012 233,199 94,196 139,896 42,484 18,516 19,235 37,703 37,361 622,590 2013 228,542 100,052 164,560 42,351 19,452 17,320 37,434 36,862 646,573 Sources: OSFI, CLHIA Assets in Canada held on behalf of foreign policyholders are excluded Assets held in segregated funds are included (See table on page 23) Figures since 2000 have been restated to include assets of life insurance companies, fraternal benefit societies, and not-for-profit health care benefit providers such as provincial Blue Cross organizations. Earlier years include data for life insurance companies only Since 2011, assets are reported under IFRS. In earlier years, assets were restated under IFRS by estimating Reinsurance Assets based on actuarial liabilities for reinsurance ceded business Policy loans are reported under Other Assets *Data not available