Most U.S. insurers plan to tackle extra funding threat in 2024, and mentioned the dangers related to the usage of synthetic intelligence (AI) within the funding course of are outweighed by the potential advantages of the know-how.
In line with results of a survey of 300 funding decision-makers by Conning, an funding agency that serves the insurance coverage trade, 80% are optimistic of the funding local weather this 12 months and 62% are prepared to tackle extra funding threat. Outcomes had been barely decrease than final 12 months when 64% mentioned they anticipated a rise in funding threat tolerance.
“Years of traditionally low rates of interest demanded that insurers think about unfamiliar asset classes to assist enhance portfolio yields,” mentioned Matt Reilly, Conning’s head of insurance coverage options and co-author of the survey report, in a press release. “The rise in charges has helped make these extra conventional investments interesting once more. Whereas many insurers seem poised to make the most of these yields, additionally they stay dedicated to including to much less conventional belongings equivalent to actual property, non-public credit score and personal fairness.”
Among the many prime portfolio issues had been inflation, the home political surroundings, and the affect of financial coverage. Home political surroundings and AI had been added to the newest survey as issues.
Regardless of some issues associated to the usage of AI and machine studying within the funding course of—equivalent to moral concerns, lack of human oversight, surprising market adjustments, and cybersecurity—three out of 4 respondents mentioned they had been at present utilizing or piloting AI/machine studying use in investments.
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