Investments: What Are Insurers Investing In?

Despite a changing market environment, the asset allocation structure remains largely stable. The share of equity assets has slightly decreased from 45.5% in 2023 to 44.2% in 2024. In contrast, the proportion of fixed-income assets has strengthened slightly to 44.6%, up from 44.1% the previous year. Real estate assets remain stable at 6.9% of the overall portfolio. Of the 108.6 billion dirhams allocated to equities, 53.2% is invested in listed securities, 23.6% in equity mutual funds, and 22.3% in unlisted shares. Fixed-income assets, totaling 109.5 billion dirhams, are primarily held in sovereign and private bonds (48.5%) and bond mutual funds (46%). Government bonds continue to attract insurers, representing nearly 59% of directly held bonds. In a context of sustained recovery in financial markets, insurers' portfolios show an increase in unrealized gains. These gains amount to 37.1 billion dirhams, a rise of +70.7% compared to 2023. This performance is driven by the two main components of the portfolio: - The equity segment, which has unrealized gains of 29.9 billion dirhams (+49.7%) due to strong stock market performance (the Masi index closed 2024 up by 22.2%). - The fixed-income segment, benefiting from declining interest rates, sees its unrealized gains rise from 380.6 million to 5.4 billion dirhams in one year. The overall rate of unrealized gains stands at 15.1%, compared to 9.3% in 2023, approaching its ten-year average of 15.5% (excluding 2022). Despite the concentration of portfolios around market assets, the results of stress tests confirm the sector's robustness against simulated extreme shocks to interest rates and equities. - In the event of an interest rate increase of 100 to 200 basis points, the average solvency margin would remain comfortable, between 340% and 327%. - Simulating a stock market correction of -10% to -20%, insurers maintain an average solvency level of 315% and 272%, respectively. These levels are significantly above the regulatory minimum, confirming the structural resilience of the sector in a potentially volatile market environment.