Alternatives form one-third of US insurance industry’s assets creating tech gap

Written by Adam Cadle

14/11/2025

Alternative investments now comprise almost one-third of the US insurance industry’s assets – representing around $2.7trn – as insurers abandon traditional portfolio strategies, a new report published by Clearwater Analytics (CWAN) has revealed.

The report, Are ‘Alternatives’ Still Alternative? revealed that the alternative asset classes leading the charge include privately placed bonds and mortgage loans.

CWAN said the shift to alternative investments has created a technology gap, with legacy systems failing to keep pace with growth in this area. CWAN data has revealed that there are currently 3 to 5x longer processing times for alternative asset operations.

“What this research shows is that alternatives have moved from the periphery to the core of insurance portfolios, they’ve already won,” said Kirat Singh, President, risk and alternative assets, CWAN.

“What we’re seeing with our clients is leading insurance companies shifting capital to privates and alts, some at 35% while others going as high as 70-80%. The real challenge now is operational, and having an open, scalable technology infrastructure becomes essential to handle this complexity.”

The report combines industry-wide NAIC data with analysis of approximately 400 CWAN insurers representing $4.4trn in combined assets.

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