An Investment Home Run
When ACLI launched its Economic Empowerment and Racial Equity Initiative in October 2020, I said that the life insurance industry was committed to advance solutions that address systemic inequality.
Today, ACLI is unveiling a historic initiative that will dramatically intensify our efforts to help close the racial wealth gap. We are launching a financial partnership network that will invest in affordable housing as part of community development around the nation.
As ACLI’s Chairman Scott Davison, President & CEO of OneAmerica, said: “ACLI and America’s life insurance companies are committed to harnessing the capital strength of the life insurance sector to enhance impact investments and help make housing affordable and sustainable in underserved communities.”
The centerpiece of the initiative is a new nonprofit affiliate being launched by ACLI and its members. The affiliate will partner with philanthropic organizations, private capital and government-sponsored entities to identify and invest in high-quality ventures supporting affordable housing throughout the United States. We expect to announce our first investments this fall.
For more than 175 years, life insurers have made safe, prudent investments that help fulfill their long-term guarantees to provide financial protection for families. Our investments in affordable housing will be made with the same careful focus to meet rigorous state investment requirements while helping to bring much-needed housing stock to communities from coast-to-coast.
In many parts of our nation, there is an acute shortage of affordable housing. And the problem is becoming worse. The median existing-home price climbed to a record-high in March, up 15% from a year earlier. Average rents rose a record 11.3% last year, with some markets soaring close to 40% in the past two years.
Together with our financing network partners, life insurers can address the needs of low-income communities on a scale that is unmatched by any single entity or sector.
When we launched our EERE initiative, we said that the battle against economic inequity would not be won overnight. And we underscored that the life insurance industry would be dedicated to this vital effort for as long as it takes.
Through this partnership we are demonstrating our sustained commitment to produce much-needed change that will help alleviate America’s longstanding racial wealth gap.
This is an important first step. But there is much work ahead. Let’s bring it home.