U.S. insurers appear to remain generally optimistic about investment conditions for 2025 (see Figure 1) and expect to continue to take on more investment risk, according to a recent survey of 310 investment decision makers in the U.S. insurance industry commissioned by Conning.¹

The recently completed election season also seems to be weighing on insurers’ minds as the domestic political environment was the top portfolio concern of 10 choices listed, even though the survey was conducted after the November 2024 elections. Portfolio yields and market volatility were tied as the second greatest concern. Inflation, which had ranked as the top concern in Conning’s previous three investment risk surveys, fell to seventh among respondents.

Insurers continue to express interest in private assets and expect their current exposures to grow. The bulk of respondents - 71% - currently have between 5% and 20% in private assets. In two years, a majority - 63% - expect to have between 10% and 25% in private assets.

The majority of respondents also said they expect to maintain or increase duration in 2025 as well as exposure to floating-rate assets, and almost all are confident they can meet the liquidity demands of their business.

Footnote:
¹The Conning U.S. Insurers Survey – Investment Focus utilized survey technology provided by Qualtrics, LLC. Results may not be representative of any one respondent’s experience as they reflect an average of all, or a sample of all, of the experiences of surveyed U.S. insurance company decision makers. In 2024, surveys were sent to approximately 2,000 U.S. insurance company investment professionals and yield 310 responses. In 2023, surveys were sent to approximately 2,000 U.S. insurance company investment professionals and yielded 300 responses. In 2022, surveys were sent to approximately 4,000 U.S. insurance company decision makers with 303 qualified responses. 2021 survey was sent to approximately 7,000 U.S. insurance company decision makers with 280 qualified responses. Qualtrics, LLC was paid a fee for services rendered.

About Conning
Conning (www.conning.com)is a leading investment management firm with a long history of serving insurance companies and other institutional investors. Conning supports clients with investment solutions, risk modeling software, and industry research. Founded in 1912, Conning has investment centers in Asia, Europe and North America. Conning is part of the Generali Group.

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