89% of US insurance investment professionals believe AI investment benefits outweigh risks

Written by Adam Cadle

24/01/2024

Eighty-nine per cent of US insurance investment professionals think the benefits of implementing AI in the investment process outweigh the risks, according to a survey sponsored by Conning.

Three out of four US investment professionals said they are already using or piloting AI and machine learning (ML) across investment-related activities such as investment research, portfolio management, investment accounting and trading.

The survey also found that over half (62%) of US insurers are willing to take more investment risk in 2024 despite mounting concerns about election year politics, fiscal/monetary policy, persistent inflation and volatility, according to a survey sponsored by Conning.

Inflation remains the top concern over the next two to three years followed by the domestic political environment in an election year, the impact of monetary policy, market volatility, the impact of fiscal policy and the impact of AI.

Overall, 51% said their portfolios would consist of at least 20% in private assets in two years. Sixty-one per cent said they will add exposure to private equity 56% to private credit and private placements, 52% to real estate and 48% to infrastructure.

“Years of historically low interest rates demanded that insurers consider unfamiliar asset categories to help improve portfolio yields,” said Matt Reilly, Conning head of insurance solutions and co-author of the survey report.

In 2023, surveys were sent to approximately 2,000 US insurance company investment professionals and yielded 300 responses. In 2022, surveys were sent to approximately 4,000 US insurance company decision makers with 303 qualified responses. The 2021 survey was sent to approx. 7,000 US insurance company decision makers with 280 qualified responses.

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