Key facts
- Regulators are increasing scrutiny of private credit valuations due to concerns about opacity and illiquidity.
- Life insurers hold an estimated $1 trillion to $1.21 trillion in private credit.
- Private credit in registered funds surged to $270 billion in 2025.
US regulators, including the Securities and Exchange Commission and state insurance watchdogs, are intensifying their scrutiny of the private credit sector. The focus is on ensuring accurate valuations of opaque and illiquid loans, which have seen explosive growth and increasing accessibility to a wider investor base. Concerns are mounting over the potential for systemic instability due to the interconnectedness of private credit, life insurers, and banks, especially as insurers finance AI data center buildouts.