Over the past two years, central banks have pumped massive liquidity into financial markets to help them cope with the fallout from the financial crisis, but now executives are worried this will "inevitably lead to a surge of inflation," according to the survey by the Geneva Association, a think tank that includes around 80 executives from the world's top insurance companies.
Some 79% of the executives who participated in the survey listed macroeconomic factors as the biggest threat to insurers.
Beyond inflation or deflation, they are also worried about the impact on their business from the European sovereign debt crisis.
The executives are also concerned about the implementation of regulatory reforms intended to address systemic risk in the wake of the financial crisis. In particular, they fear that regulators aren't distinguishing enough between banks and insurers when setting up measures to cope with systemic risk, or the risk that the failure of one institution would trigger the collapse of the whole market.
Compared with banks, most insurers coped relatively well with the financial crisis. The few companies that suffered big losses, such as American International Group Inc. (AIG) in the U.S. or Swiss Re in Europe, did so through their banking activities, insurance executives who presented the survey said.
Any new regulation for systemic risk therefore needs to take into account the sort of activities insurers have that pose such risk, and avoid treating all institutions in the same way, they say.
The fact that "regulation is listed as a key threat is a demonstration of how seriously potentially mistaken regulation could affect our industry," said Nikolaus von Bomhard, chairman of the Geneva Association. He is also chief executive officer at Munich Re, the world's largest reinsurance company.