Insurance Multi-Asset Outlook — Higher inflation, rising rates: Front and center for insurers

Wellington Management Insurance Multi-Asset Outlook — Higher inflation, rising rates: Front and center for insurers Featured

Tim Antonelli, CFA, FRM, SCR, Insurance Multi-Asset Strategist, Wellington Management

The views expressed are those of the author at the time of writing. Other teams may hold different views and make different investment decisions. The value of your investment may become worth more or less than at the time of original investment. While any third-party data used is considered reliable, its accuracy is not guaranteed. For professional or institutional investors only.

In our 2022 Insurance Outlook, we highlighted persistent inflation and rising interest rates as critical factors for insurers investing in the new year. It’s safe to say these themes are now front and center in a major way. Market complications are piling up early in 2022 and weighing on equity and bond returns. The year began with higher-than-expected inflation (the US CPI hit 7.9% in February) and the US Federal Reserve’s (Fed’s) firm response to it (signaling a first rate hike in March, which the Fed delivered). Then it took another sharp turn with Russia’s invasion of Ukraine — creating a massive and distressing humanitarian crisis, while adding another layer of market complexity given Russia’s role as a global supplier of commodities (notably oil).

So where to from here?

Wellington Management
Wellington Management

Insurers have been building investment partnerships with Wellington since 1975. With $140 billion AUM as of June 30, 2022, our goals since then have remained evergreen – to exceed the investment objectives and service expectations of our clients. As an integral part of Wellington’s global investment platform, our dedicated Financial Reserves team offers a breadth and depth of resources and experience to serve our insurance clients as a go-to thought partner, risk manager, and trusted advisor for complex investment challenges. The new decade we have just entered looks more treacherous from a risk perspective than anyone could have imagined. Our collaborative strategic and proactive risk management approach helps our clients to be well-prepared.

Rich Coffman
Americas
rmcoffman@wellington.com
+1 617 951 5311

Max Davies, CFA
APAC
mdavies@wellington.com
+852 2846 6011

Sarah Marschok
Americas
smmarschok@wellington.com
+1 617 790 7170

Bob Sharma, CFA
EMEA
bssharma@wellington.com
+44 20 7126 6068

www.wellington.com/en

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