The International Association of Insurance Supervisors (IAIS), a global body representing insurance regulators in more than 200 jurisdictions, has issued its Global Insurance Market Report 2025 (GIMAR), Outline the key developments affecting the industry.
The report shows that the industry continues to demonstrate strong capital strength, stable liquidity and healthy profitability, while overall systemic risks have declined slightly.
It draws attention to increasing private credit allocations, pressures from geoeconomic fragmentation, and rapid advances in artificial intelligence (AI), all of which are becoming core priorities for regulators around the world. It also highlights the increasing importance of closely monitoring climate-related risks and cyber threats.
The findings, released in Basel, stem from the IAIS global monitoring activity, which tracks trends in key markets and assesses possible sources of risk. This year’s analysis explores how global financial conditions and changing business strategies are impacting insurers’ operating and regulatory expectations.
Toshiyuki Miyoshi, Chairman of the IAIS Executive Committee, commented: “GIMAR 2025 highlights the resilience of the global insurance industry amid major structural shifts. As insurers respond to the rapid expansion of private credit, manage risks from geoeconomic fragmentation, and embrace the changing role of artificial intelligence, regulators must ensure that governance, risk management and monitoring frameworks are strengthened to respond to these changes.”
IAIS Secretary General Jonathan Dixon said: “This year’s report reaffirms the IAIS’s commitment to identifying emerging risks and supporting regulators around the world in addressing these challenges. By strengthening our monitoring and regulatory framework, we aim to ensure the continued stability and resilience of the global insurance industry.”
The report noted that insurance companies continue to maintain strong capital buffers, stable liquidity and supportive profit levels. Non-life insurers’ combined ratios improved in several regions, while life insurers benefited from favorable market movements and improving spreads. Despite remaining geopolitical and economic uncertainties, expectations for 2026 remain stable.
Systemic risk indicators for large international groups have declined slightly, and the systemic footprint of the insurance industry remains much smaller than that of the banking industry. The IAIS has completed a scheduled review of individual insurers’ monitoring methods, further strengthening its approach to assessing systemic risk. The Financial Stability Board reiterated its reliance on the overall IAIS framework to understand insurance risk patterns.
A major section of the report reviews the expansion of private credit holdings, particularly those of life insurance companies. While total exposure remains modest, exposure is rising rapidly in several markets. This asset class may offer benefits related to compensation for long-term liabilities and illiquidity, but it also presents challenges involving valuation, liquidity, borrower quality and structural complexity. The findings reinforce themes explored in an IAIS issues paper released in November, which looked at shifts in the life insurance industry, including the increased use of alternative assets and cross-border asset-intensive reinsurance.
The report also explores the impact of geoeconomic fragmentation, citing trade frictions, sanctions, divergent monetary policies and uneven market conditions as factors exacerbating financial volatility. These forces complicate asset liability management for internationally active insurance companies. Executives are responding with expanded scenario work, additional data requests and closer cross-border coordination.
The use of artificial intelligence in underwriting, pricing and claims processes continues to grow rapidly. While insurers noted significant efficiency gains, the report also noted concerns involving model oversight, transparency, cyber exposure, operational risk, data bias and reliance on external providers. An IAIS application paper released in July provides guidance to support responsible integration of artificial intelligence.
Portfolio exposures to climate-related risks remain stable, while underwriting data shows changing patterns in natural catastrophe underwriting and reinsurance demand. Despite data availability and methodological challenges, insurers and regulators are increasingly turning to climate scenario analysis. The recent GIMAR special edition on protection gaps highlights the IAIS’s commitment to strengthening climate risk assessment tools.
Entering 2024, reinsurance companies are well-capitalized and their performance has stabilized following an increase in catastrophe losses in previous years. Premiums continue to rise, retention levels have increased slightly and the portfolio remains conservative.
Looking ahead, as part of the 2026-2027 plan, the IAIS will expand its monitoring of alternative assets, continue to advance systemic risk analysis, develop regulatory guidance on structural changes in the life industry, and further refine its climate risk and protection gaps work.