Tariffs and trade disputes have emerged as a key concern for insurers, according to Goldman Sachs Asset Management’s (GSAM) latest annual survey of industry executives.
Nearly one-third (32%) of chief investment officers and chief financial officers cited trade tensions as a significant macroeconomic risk, ranking it fifth among top concerns. The issue did not appear in last year’s survey, highlighting a shift in sentiment amid ongoing economic uncertainty.
“We did close the survey approximately six weeks ago,” said Michael Siegel, global head of insurance asset management and liquidity solutions at GSAM. “I think if we surveyed right now… the number would be significantly higher.”
Since returning to office in January, President Donald Trump has introduced and modified tariffs on major trade partners, including China, Canada, and Mexico. A Wall Street Journal report on March 23 suggested the administration planned to narrow the scope of new tariffs set to take effect in April, opting for a more targeted approach. The uncertainty surrounding trade policy has contributed to market volatility, adding to insurers’ concerns over portfolio stability.
Despite rising concerns over trade, inflation remains the top risk for insurers, with 52% of respondents citing it, up from 42% last year. Fears of a US recession, however, have eased slightly, with 48% of executives identifying it as a major risk, down from 52% in 2024.
Market volatility and geopolitical tensions remain pressing issues. Forty-seven percent (47%) of respondents highlighted credit and equity market fluctuations as a risk, while 43% pointed to geopolitical uncertainty, both slightly lower than last year’s figures.
As economic conditions remain uncertain, insurers are increasing allocations to private investments. The survey found that 62% of respondents plan to expand their exposure to private assets in the coming year, with private credit ranked among the most promising asset classes for returns.
At the same time, artificial intelligence is playing a growing role in the industry. Nearly half of respondents (48%) reported already using AI in their operations, while another 42% said they plan to explore its adoption within the next year.
GSAM’s survey, The Great Pivot, gathered responses from 405 insurance executives managing a collective $14 trillion in global balance sheet assets. Life insurers made up the largest share of respondents (43%), followed by property and casualty insurers (29%), multiline insurers (16%), reinsurers and health insurers (both 5%), and captives (1%).
“These findings underscore the broader industry-wide migration toward more diversified and illiquid investment portfolios,” Siegel said. “Insurers are looking to diversify, and we see an increase in duration risk, an increase in credit risk, and a movement toward more illiquid investment.”
As trade tensions, inflation, and market volatility continue to shape the economic landscape, insurers are adjusting strategies to mitigate risk and capitalize on new investment opportunities. The coming months may further influence industry sentiment as insurers respond to evolving market conditions.
