Insurance Asset Risk's Investing in Real Assets 2022 conference's first day focussed on the macroeconomic environment, insurers' net-zero pledges implications for real asset portfolios and opportunities in the US.
In a 'double' fireside chat, two economists set the scene on the current macro-economic outlook.
Charlotta Groth, managing director and global macroeconomist for group investment management at Zurich Insurance Group, said central bankers will define the year ahead in their quest to tighten the economy to counter inflation while not tightening to much that it creates a recession.
Jerome Jean Haegeli, group chief economist at Swiss Re, warned that recession risk was more real than most people think.
Both economists highlighted how the current geopolitical tensions in Ukraine were a source of uncertainty and volatility.
A consequence of the conflict in Ukraine has been a rise in oil prices, but this is no excuse for insurers to ignore their ESG investing pledge, at least for a little bit.
But panellists from ClimateWise, Aviva and Phoenix Group said the answer is no. Firstly because high oil price is a snapshot of the broader story in a move to a lower carbon economy. Secondly, because high oil prices might be an opportunity for short-term investors, but long-term investors (i.e. insurers) will reap the benefits of renewables in the long run. And thirdly, the transition needs to be just, which means the move out of brown needs to done at the same speed as the move into green, to insure the most vulnerable parts of society are not impacted.
The first day ended with a focus on real assets investment trends in the US, during which four heads of investment at north American insurers revealed that most of their investment in the asset class were conducted in the real estate sub-class. And panellists from Transamerica, SunLife, Aeglis Insurance and The Doctors Company highlighted how current inflationary trends occupied much of their thoughts.
Insurance Asset Risk's Investing in Real Assets conference 2022 is taking place online on the 5th and 6th of April. More information about the conference can be found on our website. The event is free to attend for insurers - please contact events@fieldgibsonmedia.com
