Industry has more than $8.6 trillion invested in the economy.

Between 2010 and 2018, the U.S. life insurance industry distributed nearly $1.5 trillion in claims and benefits to policyholders, an amount equal to 19 percent of all Social Security payments made over that same period, according to a study released today.

These numbers highlight the crucial role that life insurers play in relieving pressure on government programs. If Social Security had to finance all the benefits provided by private life insurance, U.S. payroll tax revenue would have to increase by at least 19 percent.

“The life insurance industry has always functioned as a private sector safety net. At a moment when public finances are strained by the COVID-19 pandemic and the economic downturn, the benefits we pay are more important than ever,” said Mike Zarcone, head of Corporate Affairs for MetLife. “Our industry also helps create the foundations of long-term prosperity by investing trillions in the economy. This study puts the magnitude of our impact into perspective.”

Social Security and Life Insurance Payments (2010-2018)


Social Security

Life Insurance


$1,021 billion

$623 billion


$5,323 billion   

$693 billion


$1,244 billion

$161 billion


$7.588 trillion 

$ 1.478 trillion


The MetLife-sponsored study, “The Social and Economic Contributions of the Life Insurance Industry,” was conducted by experts at The Brattle Group, a global economic consulting firm that has advised both government agencies and private companies. It highlights the many ways that life insurers improve living standards, buttress social programs, and invest to promote economic growth and efficiency.

A Vital Supplement to Government Programs

Like Social Security, life insurers protect people against the risks of death, disability, and aging. In that sense, they provide a vital supplement to the largest U.S. federal spending program. If private life insurance did not exist, and if Americans received the same amount of survivor, retirement, and disability benefits, the size and cost of Social Security would have to increase significantly.

In addition to reducing pressure on Social Security, life insurance helps ease the burden on means-tested government programs such as Medicaid. Families qualify for those programs based on income levels. When primary wage earners die, life insurance provides financial support that can potentially keep their dependents from falling into poverty.

The study estimates that by delaying or preventing poverty, life insurance saves the government roughly $800 million a year. In the process, it helps thousands of families and children avoid a drop in their standard of living.

A Cost-Efficient Financial Safeguard

In 2018, U.S. life insurance policies in force provided $19.6 trillion of financial protection, an amount equal to about 95 percent of U.S. gross domestic product (GDP).

Risk pooling makes life insurance less costly and more financially efficient than self-insurance. As a result, among the approximately 61 percent of American households covered by some form of life insurance, the average policy coverage amount is more than 2.5 times their annual household income.

The study illustrates the power of risk pooling by examining a hypothetical 40-year-old individual who earns $75,000 a year and wants to provide $300,000 of financial security to dependents in the case of premature death over the next 20 years.

“Self-insurance would require saving $9,073 every year for 20 years to reach a total of $300,000 by year 20 (assuming a 5 percent annual return) and only the actual amount saved is available at any given time before year 20,” the study notes. “Alternatively, term life insurance can be obtained with an annual premium of $600 or less1, and the family will achieve full financial protection immediately.”

A Source of Trillions in Long-Term Investment

Beyond its benefits to individuals and governments, life insurance also drives long-term economic prosperity. The industry employs hundreds of thousands of people across the U.S., but its economic contributions go much further than direct jobs.

Most notably, life insurers channel household savings into productive investments that fuel jobs and economic growth. The Brattle Study cites research estimating that every 1 percentage point increase in the ratio of life insurance premiums to U.S. GDP would increase economic output by $28 billion.

As of 2019, life insurers had more than $8.6 trillion of capital invested in the economy. Because the industry focuses on long-term investments to support its liabilities, life insurers represent a stable funding source for the credit markets and can help mitigate the effects of financial crises.

In 2018 (the most recent year for which data are available), 95 percent of life insurers’ bond investments had maturities greater than five years at the time of purchase, and 72 percent had maturities of 10 years or more. By comparison, in 2019, only 27 percent of commercial bank financial assets had a maturity greater than five years.

Life insurers are especially important lenders in the private placement debt market, which tends to attract small- to mid-sized companies that have less access to the public debt market. As of 2018, private placement issuances made up more than $1 trillion — or about 33 percent — of life insurers’ total bond holdings.

“Life insurance is an important component of the U.S. economy,” the study concludes. “It plays a unique role not only in the safety and security it provides to individuals, but in the stability and liquidity it provides to the financial markets and the overall economy. Furthermore, the life insurance industry significantly alleviates the financial burden caused by mortality, longevity, and morbidity risks for individual households and the U.S. government.”

To access The Brattle Group’s study, click here.

About MetLife

MetLife, Inc. (NYSE: MET), through its subsidiaries and affiliates (“MetLife”), is one of the world’s leading financial services companies, providing insurance, annuities, employee benefits and asset management to help its individual and institutional customers navigate their changing world. Founded in 1868, MetLife has operations in more than 40 markets globally and holds leading positions in the United States, Japan, Latin America, Asia, Europe and the Middle East. For more information, visit