Private assets are becoming a core feature of insurance portfolios across Asia-Pacific, with insurers expecting allocations to climb to roughly one-third of assets within the next five years, new research from Clearwater Analytics shows.
The survey, conducted in October 2025, polled 150 senior executives overseeing insurance asset management in Hong Kong, Singapore and Australia. Together, the respondents manage $3.823 trillion in assets. On average, insurers currently allocate about 20% of insurance-focused assets to private markets, a figure executives expect to rise to 33% over the medium term.
The shift reflects a clear reassessment of where opportunity lies. Ninety-three percent of executives said private markets currently offer more attractive investment opportunities than public markets, with 37% expressing strong agreement. Diversification is the dominant rationale, with 88% expecting diversification to increase over the next three years.
Expectations vary by investor type. Third-party managers reported the strongest appetite for change, with 30% anticipating dramatic increases in diversification, compared with 10% of life and health insurers and 4% of general insurers.
“APAC insurers are firmly convinced how attractive investing in private markets, which have produced consistently attractive returns for their portfolios,” said Shane Akeroyd, chief strategy officer and president of Asia Pacific at Clearwater Analytics.
While confidence in the asset class is high, execution remains uneven. Forty-one percent of executives cited growing legal and compliance complexity associated with private investments, while 29% said combining private assets with traditional holdings continues to pose challenges.
At the same time, most respondents expressed confidence in their infrastructure. More than 90% said their systems can effectively process new asset classes, and 92% said valuing private market assets is easy or manageable.
“That is reflected in the forecasts about rising allocations to private markets and the recognition that many of the most attractive investments are in that sector. However, operational concerns have to be addressed by insurers,” Akeroyd said.
The operational divide is emerging as deal activity slows. Insurance M&A across Asia-Pacific fell to 14 deals in the third quarter of 2025, down from 20 in the previous quarter, even as 96% of executives expect consolidation to pick up over the next three years.
Insurers with stronger operating capabilities may be better positioned as private exposure continues to rise, with capital deployment becoming more selective.