UK insurers hungry for risk despite rising global fears

UK insurers have broken rank with European and American rivals by boosting their appetite for risk-taking, according to a global poll by the fund arm of Goldman Sachs

The number of UK insurance companies planning to increase investment risk was 17% above the number cutting back.

In continental Europe, the figure was 10% down and 9% lower in America.

Goldman Sachs Asset Management's Etienne Comon said Britain’s divergence was a “delayed move” by general insurers who have “very conservative portfolios” by global standards.

Neil Moge, head of European insurance portfolio management, added: “The UK has arguably been more prudently managed so maybe it’s the slow pressure to find some excess returns which means embracing a more global opportunity set."

He said UK insurance clients were becoming keener on dollar investments to cover liabilities in pounds, due to a lack of sterling-denominated assets in the market.

The number of high-yielding investments in pounds is typically much lower than those listed in dollars.

The survey, running for seven years, also showed a collapse in the number viewing politics as a risk.

Ahead of the French election last year, 26% ranked “political events” as the biggest economic risk but only 4% said the same this time.

Recession in the US was top spot.

Goldman Sachs polled 300 chief investment officers and chief financial officers who represent over £10 trillion of assets.

Around 77 were in Europe, including the UK, with the bulk in America and Asia.