Kathmandu. Despite rising geopolitical tensions, inflationary pressures and rising sovereign debt levels, the global insurance sector remains financially stable until the end of 2025.
This is what the International Insurance Supervisory Association (IAIS) mid-year Global Insurance Market Report 2026 has shown. Preliminary results from the IAIS’s 2026 Global Monitoring Exercise showed that insurance companies have maintained stable solvency, liquidity and profitability. This is supported by strong operational performance, effective asset-liability management and strong capital buffers. However, the overall systemic risk score for global insurance groups increased slightly compared to a year ago.
The IAIS has also warned that insurance companies will operate in an increasingly complex environment in 2026. Geopolitical tensions, macroeconomic uncertainty and cyber threats will put more pressure on balance sheets and business models. For this reason, insurance supervisors have identified 3 key areas to monitor closely this year. These include the impact of Artificial Intelligence (AI) and technology on the impact of macroeconomic risk on life insurance companies, transmission of geopolitical risks to non-life insurance companies, and cyber resilience of insurance companies.
According to the report, high interest rates, rising credit spreads and persistent inflation are posing significant challenges to the long-term liabilities of life insurance companies. Meanwhile, geopolitical conflicts are disrupting energy markets, driving up claims costs and increasing underwriting risks for non-life insurance companies.
According to the IAIS, insurance companies are responding by strengthening risk management practices through asset redistribution, liquidity stress testing, scenario analysis and improved capital and liquidity buffers. “Mid-year GIMAR demonstrates the strength and capability of the insurance sector to address continued global challenges,” said Toshiyuki Miyoshi, Chair of the IAIS Executive Committee.
IAIS Secretary-General Gerry Cross said: “The growing interconnectedness of macroeconomic, geopolitical and cyber risks necessitates a more dynamic and forward-thinking approach to insurance supervision. –Agency
