Goldman Sachs Asset Management Global Insurance Asset Survey: Only 17% of insurers increase allocation to U.S. stocks, private equity assets receive the most attention

On March 25, 2025, Goldman Sachs Asset Management released the 14th Global Insurance Survey titled "Significant Shift."

The survey shows that against the backdrop of a changing geopolitical environment, most global insurance institutions are concerned about the impact of inflation on their portfolios. 52% of the surveyed insurance companies view inflation as the biggest macroeconomic risk, up from 42% in 2024, nearly returning to the level of 2023.

Despite the market potentially being affected by rising inflation and slowing economic growth, the demand for allocation to private assets remains strong among insurance companies.

Notably, the Goldman Sachs Asset Management survey indicates that 58% of insurance companies plan to increase their allocation to private credit in the next 12 months.

More Optimistic About Private Assets

The survey from Goldman Sachs' buy-side department shows that insurance companies believe the top five macroeconomic issues posing risks to their portfolios are:

• Inflation (52%)
• Slowdown/recession in the U.S. economy (48%)
• Volatility in credit and equity markets (47%)
• Geopolitical environment (43%)
• Tariffs/trade (32%)

The survey reveals that over 90% of insurance companies in the Asia-Pacific region plan to increase or maintain their overall portfolios in the next 12 months. Similar to 2024, the preference for credit risk among insurance companies in the Asia-Pacific region remains the highest at 42%, while it is 16% in the Americas and 18% in Europe, the Middle East, and Africa.

The demand for illiquid assets among Asia-Pacific insurance companies has also increased, with the net increase in liquidity risk rising from 7% in 2024 to 30%.

Among the asset classes expected to yield the highest total returns in the next 12 months, insurance companies are optimistic about private assets. Private credit (61%) ranks first for the second consecutive year. The second to fifth places are: U.S. equities (57%), private equity (55%), secondary market private equity (30%), and high-yield bonds (28%).

Cautious About U.S. Stocks

83% of insurance companies expect the S&P 500 Index to deliver positive returns in 2025. However, after the S&P 500 rose 26% in 2023 and recorded a 25% increase in 2024, growth is expected to slow this year: 50% of respondents anticipate the S&P 500 Index will rise between 5% and 10% within the year; only 15% of respondents believe its increase will be between 10% and 20%.

Only 17% of insurance companies plan to increase their allocation to U.S. stocks, 10% plan to increase their allocation to European stocks.

In fixed income, 35% of insurance companies expect to increase duration risk in 2025, down from 42% a year ago. This shift towards a cautiously optimistic attitude indicates that the future interest rate environment remains attractive for yield-seeking investors.

Increased AI Applications Driving Industry Consolidation

68% of respondents believe that operational synergies and economies of scale are the main driving factors behind the increase in mergers and acquisitions in the insurance industry. The increasingly prevalent use of AI is expected to enhance efficiency and may drive further industry consolidation: 90% of insurance companies are currently using or considering using AI, up from 80% in 2024 Among the respondents planning to adopt AI applications, 81% indicated that reducing operating costs is their primary consideration.

This survey was conducted from January to February 2025, with 405 chief investment officers and chief financial officers from insurance companies participating, marking the highest number in the history of this series of surveys. The total assets of the participating insurance companies exceed $14 trillion, accounting for about half of the global insurance assets.

The survey also showed that insurance companies are optimistic about the prospects of private assets, with the following proportions of respondents planning to increase asset allocation:

• 58% will increase allocation to private credit
• 40% will increase allocation to investment-grade private debt
• 36% will increase allocation to asset financing
• 32% will increase allocation to infrastructure bonds
• 29% will increase allocation to private equity

As of December 31, 2024, Goldman Sachs Asset Management manages $460 billion in general account assets for insurance clients.

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