The insurance market in the Republic of Croatia is becoming increasingly important in maintaining the financial security of individuals and companies. The most important participants in this market are insurance companies that represent financial intermediaries and which are obliged to harmonize their operations with the legislation of the country in which they operate. One of the insurance business is life insurance, which is gaining attention in the Republic of Croatia due to its savings component. In order for insurance companies to successfully cover the obligations from the insurance contract, it is necessary to form technical reserves. The most important part of technical reserves is the mathematical reserve, which is used only to settle life insurance obligations. The mathematical reserve constitutes the largest share of the liabilities of the balance sheet and therefore insurance companies are forced to reasonably invest assets to cover the mathematical reserve in order not to incur losses. The final thesis analyzes the mathematical reserve on the example of two selected insurance companies in the Republic of Croatia and presents the impact of the mathematical reserve on the financial statements. Also, investments of assets to cover mathematical reserve were analyzed in order to be able to conclude which securities insurance companies invest the most in and whether they are more devoted to more stable or riskier securities.