For the first time since the problem days in the early part of this decade, the life and health insurance industry has increased its investment in junk bonds, a survey by Weiss Ratings found.
According to Weiss' research on 1,100 insurance companies, the industry increased its junk bond holdings by $3.5 billion in 1994 for the first time since the early part of the 1990s.
In the early 1990s, large holdings of junk bonds triggered the failures of several large insurance companies across the country.
Other life insurers reacted to those failures in 1992 and 1993; they decreased their junk bond exposure by $6 billion, according to Weiss.
According to the data, the largest buyers of junk bonds include Equitable Life Assurance and Equitable Variable Life, which added a net of $714 million; New York Life Insurance, $268 million; and John Hancock Life, $235 million.
