Top insurance asset managers gaining traction via customized strategies

India Infoline News Service | Mumbai |

The financial crisis taught institutional investors, including insurers, the value of non-correlated assets in periods of market stress

New research from global analytics firm Cerulli Associates finds that top insurance asset managers are gaining traction by creating customized strategies.
 
"The financial crisis taught institutional investors, including insurers, the value of non-correlated assets in periods of market stress," states Alexi Maravel, associate director at Cerulli. "While capturing low or non-correlated asset classes is important for volatility mitigation, diversifying sources of income is equally, if not more critical."
 
In the third quarter 2014 issue of The Cerulli Edge - Institutional Edition, Cerulli examines the unique challenges of insurance general accounts and explores the evolution of investment strategies designed specifically for the needs of insurance companies.
 
"While insurers see the value of exposure to nontraditional and alternative asset classes, many leading third-party insurance asset managers are devising ways to make these investments more palatable to insurers given their regulatory and risk constraints," Maravel explains. "Those managers making headway in this space can both illustrate the value of nontraditional investments to insurers, and develop risk-based-capital-friendly solutions to meet their needs."
 
In addition, several institutional asset managers told Cerulli they have more in-depth conversations with their insurance clients on the broad topic of asset allocation, and more specific talks on managing risk-factor exposures.
 
"As many multi-asset-class asset allocation solutions are either absolute return or completely unconstrained, insurers are considering employing these strategies for reducing duration exposure," Maravel continues.
 
Cerulli believes it is in asset managers' interest to work closely with insurance clients on asset allocation issues.
 

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