The sector for life insurance companies encompasses all legal reserve life insurance companies in the United States. These companies write about 98 percent of the life insurance policies in effect in the United States (the remaining policies are written by fraternal societies, savings banks, and the federal government); they also administer individual and group annuities. Life insurers included in this sector file the Life and Health Insurance financial statements with state regulators. While these companies often provide some health insurance through products such as disability insurance and long-term care insurance, companies that are solely health insurance providers, including health maintenance organizations, are regulated separately and are not included in the sector for life insurance companies.
The companies' major sources of funds are premiums and annuity considerations; they also receive substantial investment income from their holdings of financial assets. Their major liabilities are reserves set aside for future benefit payments under life insurance and annuity contracts.