The global insurance sector remained financially stable at the end of 2025 despite rising geopolitical tensions, inflationary pressures and elevated sovereign debt levels, according to the International Association of Insurance Supervisors.
The assessment was presented in the IAIS Mid-Year Global Insurance Market Report 2026, which examines developments affecting insurers and the wider financial system. The report indicates that insurers have continued to maintain overall financial resilience despite an increasingly uncertain global environment.
Geopolitical conflicts can affect insurers through financial-market volatility, disrupted trade and supply chains, weaker economic growth and increased claims exposure. Inflation can also raise repair, healthcare and replacement costs, placing pressure on claims expenses and insurance pricing.
Elevated sovereign debt presents another important risk because insurers commonly hold significant investments in government and fixed-income securities. Changes in interest rates, sovereign credit quality or bond valuations can therefore affect investment portfolios and capital positions.
Although the sector remains stable, insurers and regulators will need to continue monitoring liquidity, credit exposures, asset-liability management and concentration risks. Stress testing and effective capital management will remain important as economic and geopolitical uncertainties continue.
The IAIS assessment suggests that the insurance sector has maintained resilience, but the external risk environment remains challenging. Insurers will need to preserve strong solvency positions while preparing for potential shocks arising from financial markets, inflation and geopolitical developments.
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