Insurers from the Asia-Pacific region are increasing their commitments to private markets at pace, according to a report by Clearwater Analytics.
The investment accounting solutions provider says executives surveyed expect that within five years roughly one third of their combined $3.8 trillion in assets will be allocated to private debt, private equity, infrastructure and other alternatives, compared with around 20% today.
Further, the study finds that 93% of respondents say legacy technology is already constraining their organisations, even as they move towards more complex asset classes that require greater operational capability.
Clearwater Analytics is forecasting an increase in consolidation activity across the region moving forward, reporting that 96% of insurers anticipate a rise in domestic mergers and acquisitions over the next three years.
In this context, it should be noted that operational strength is becoming a key competitive factor, with firms that address capability gaps better positioned to lead consolidation, while those that do not may become targets.
