# Investment Yield

Investment income as a percentage of average invested assets.

## Definition

An insurer invests premiums before claims are paid. The investment yield is the gross income from that portfolio over the average of its year-end and year-ago investments.

## Formula

(Investment Income ÷ Average Total Investments) × 100

## Why it matters

Float income is a second profit engine. A strong yield can offset an underwriting loss.

## How Standard Equity uses it

Substituted for FCF to net income in insurer reports. Gross of investment expenses; unit-linked life insurers can show a negative yield when markets fall.

## The metric

| Category   | Insurance      |
| ---------- | -------------- |
| Unit       | %              |
| Applies to | Insurance only |

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