US life insurers' AI holdings rise 24% to $85.2 billion

US life insurers held roughly $85.2 billion of investments tied to artificial intelligence at the end of June, 24% more than at the end of 2025, according to a Moody's Corp. report cited by Royal Gazette Bermuda Re. The holdings include hyperscalers, data centres and chip manufacturers, and Moody's expects the exposure to keep growing.

Debt backing the digital infrastructure that supports AI rose 34% to $39.5 billion at the end of June, a bucket that includes project financing for data centres, graphics processing units and tensor processing unit equipment. Most of those holdings are investment grade; the share rated junk rose to 6.1% from 4.7%, Moody's said.

Moody's puts the sector's AI exposure at 1.4% of cash and invested assets. That figure may understate the position: investments backed by hyperscaler guarantees and leases add exposure not reflected in direct holdings, and the analysis excluded companies whose performance is highly correlated to the AI ecosystem. Credit screens built on direct holdings will undercount AI-linked exposure, because hyperscaler guarantees and leases sit outside the reported direct holdings.

The five companies Moody's calls hyperscalers account for roughly $32.2 billion of the total, 21% more than at year-end. Alphabet, Amazon, Meta Platforms, Microsoft and Oracle make up that group; the $32.2 billion is about 6.6% of their outstanding debt and roughly 38% of the $85.2 billion.

The junk share moved 1.4 percentage points in six months, from 4.7% to 6.1%, while the digital-infrastructure book grew 34%, so the sub-investment-grade slice is rising off a fast-growing base. Moody's also flagged that credit quality among the correlated companies it left out could weaken if spending on AI slows, a risk that would sit outside the $85.2 billion.