Key Takeaways
- • Approximately 75% of insurers plan to increase private markets allocations over the next 12 months, according to a BlackRock survey reported by the Financial Times, though this is down from 94% a year earlier.
- • The survey covers insurance companies managing more than $24tn in assets, indicating significant institutional capital behind the private markets trend.
- • 41% of respondents prioritise increased private debt exposure over other private asset classes, including buyouts.
- • Rising public yields are challenging private debt's relative appeal: US 10-year Treasury yields rose from 4.18% at the start of 2026 to 4.96%, and investment-grade corporate yields reached 5.84%.
- • Regulatory capital treatment is insurers' leading concern, following new US capital requirements for certain CLO holdings introduced in July and heightened scrutiny of private credit ratings.
Summary
Approximately 75% of insurers plan to increase their allocations to private markets over the next 12 months, despite rising government bond yields and growing scrutiny of private credit, according to a BlackRock survey reported by the Financial Times. The survey covers insurance companies managing more than $24tn in assets. Appetite remains strong, although the share planning to increase allocations has fallen from 94% last year.
Private credit remains a particular focus. According to the survey, 41% of respondents prioritise increased exposure to private debt over other private asset classes, including buyouts. Institutional demand has reportedly held up despite redemption pressures in retail-focused private credit vehicles and concerns over deteriorating loan quality.
The relative attractiveness of private debt has been challenged by rising public fixed income yields. US 10-year Treasury yields have increased from 4.18% at the start of 2026 to 4.96%, while investment-grade corporate debt yields have risen to 5.84%.
Regulatory and capital treatment reportedly emerged as insurers' leading concern regarding private debt exposure. US insurance regulators introduced new capital requirements for certain collateralised loan obligation holdings in July and have increased scrutiny of private credit ratings used to determine insurers' capital requirements.
Mark Erickson, BlackRock's global insurance strategist, said a significant rise in defaults and weaker recovery rates could moderate future allocations. However, the survey suggests insurers have yet to materially scale back their private markets plans.
Private credit remains a particular focus. According to the survey, 41% of respondents prioritise increased exposure to private debt over other private asset classes, including buyouts. Institutional demand has reportedly held up despite redemption pressures in retail-focused private credit vehicles and concerns over deteriorating loan quality.
The relative attractiveness of private debt has been challenged by rising public fixed income yields. US 10-year Treasury yields have increased from 4.18% at the start of 2026 to 4.96%, while investment-grade corporate debt yields have risen to 5.84%.
Regulatory and capital treatment reportedly emerged as insurers' leading concern regarding private debt exposure. US insurance regulators introduced new capital requirements for certain collateralised loan obligation holdings in July and have increased scrutiny of private credit ratings used to determine insurers' capital requirements.
Mark Erickson, BlackRock's global insurance strategist, said a significant rise in defaults and weaker recovery rates could moderate future allocations. However, the survey suggests insurers have yet to materially scale back their private markets plans.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.