Insurers seek diversification with private market assets

Whilst inflation has eased, interest rates remain elevated.

Insurers are expected to prioritise high-quality fixed-income investments, as yields on government and corporate bonds stay attractive, according to PineBridge Investments’ latest report.

The 2025 Global Insurance Investment Outlook from PineBridge Investments outlines key trends shaping the insurance investment landscape amidst market uncertainty. 

The report further said that whilst inflation has eased, interest rates remain elevated, impacting asset allocation strategies.

However, concerns over credit risk persist, particularly in sectors sensitive to economic slowdowns. 

Equity market volatility remains a challenge, with insurers maintaining cautious exposure to public equities.

Private market investments, including private credit and infrastructure, continue to gain traction as insurers seek diversification and yield enhancement. 

Regulatory changes and evolving capital requirements are also influencing investment decisions, prompting insurers to balance risk and return more carefully.