Insurance Investment Outsourcing Hits New Scale: Clearwater Analytics
The insurance industry is undergoing a substantial transformation, as total assets in outsourced insurance have reached $5.5 trillion, up about $1 trillion year over year, a new survey revealed.
That figure represents a 23% increase from last year and a 65% expansion since 2021, according to a newly released survey from Clearwater Analytics with DCS Financial Consulting.
As private market exposure continues to grow across the insurance sector, companies are increasingly shifting from internally managed institutions to asset managers and alternative investments.
Private insurance assets have doubled since 2021, reaching about $947 billion, with 67% of managers now offering private fixed-income capabilities alongside traditional public market products, the survey stated.
Typically, insurers have managed their investment portfolios internally, with heavy reliance on bonds. Now, insurers are deploying capital into middle-market corporate lending, infrastructure debt, credit strategies, and structured credit.
While the United States has seen a sharp expansion in insurance outsourcing, Europe and the United Kingdom have also seen a sharp growth in outsourced insurance assets. Assets for that region grew 32% year-over-year from $1 trillion to $2.1 trillion since 2021.
Additionally, Europe and the U.K. now account for 38% of total outsourced insurance assets, the survey found.
“The near doubling of consultant AUA in two years tells you that insurers are engaging experts to build and manage increasingly diverse and complex strategic investment programs,” said Steve Doire, owner of DCS Financial Consulting and strategic advisor to Clearwater Analytics. “This market has moved well beyond North American dominance, and the managers best positioned for what comes next are those who recognized this global shift and invested in the capability and presence to win across regions.”
The Insurance Investment Outsourcing report surveyed 96 asset manager profiles across 12 investment consultant profiles and regional rankings. The report is produced with DCS Financial Consulting, with Institutional Investor serving as industry engagement partner.