After Trump's Pause, the U.S. is Back in Fashion Among Foreign Insurers

Foreign insurers are once again ramping up their exposure to U.S. assets, reversing the pullback seen earlier in President Donald Trump’s second term.

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According to a recent study by Clearwater Analytics (CWAN), overseas insurers increased their average daily net purchases of U.S. assets by 63%, reaching $71 million between early July and late August. The findings, based on a 90-day moving average, highlight a renewed appetite for American investments after months of hesitation.

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“This trend is likely to persist,” noted Matthew Vegari, head of research at Clearwater Analytics. He explained that the prospect of lower interest rates, combined with greater economic clarity as trade agreements solidify, could help ease the concerns that had kept insurers on the sidelines. “Much of the divestment pressure was really a story of early 2025,” Vegari added.

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The caution among foreign insurers took hold around last year’s election period. Trump’s trade stance rattled global markets and raised questions about the longer-term direction of the U.S. economy. In response, overseas insurers trimmed their exposure. Clearwater’s data shows that U.S. assets in foreign insurer portfolios dropped from 55% in January to 52% by July.

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That retreat reflected a broader uncertainty: whether escalating trade disputes would dampen growth or undermine U.S. financial stability. For insurers with global obligations, reducing American exposure was a way to hedge against potential volatility.

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Now, conditions appear to be shifting. Lower borrowing costs and signs of progress on trade negotiations are providing the kind of stability insurers look for when allocating capital. The renewed buying signals that foreign insurers see value returning to the U.S. market, especially in high-quality fixed-income assets that align well with their long-term liabilities.

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“This rebound suggests insurers are becoming more comfortable with the U.S. outlook,” Vegari said. “The worst of the uncertainty may be behind us.”

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The Clearwater Analytics report draws from investment activity of 50 foreign insurers, representing more than $100 billion in combined assets under management. Importantly, over half of these companies are based in the United Kingdom, giving the data a strong European perspective.

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This pool of insurers provides a useful lens into how major international players view the U.S. market. Because insurers are inherently conservative investors often prioritizing safety and predictable returns their behavior can serve as a barometer of broader confidence in the American economy.

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A revival of foreign insurer interest in U.S. assets could have several ripple effects. Stronger demand for American bonds, for example, could help keep yields in check, supporting broader financial stability. Increased inflows may also bolster liquidity across credit markets, which can benefit both corporate borrowers and investors.

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For equity markets, the picture is less direct but still positive. Greater foreign participation in U.S. assets adds to the overall base of international capital that supports valuations. In an environment where rate cuts are on the horizon, this renewed appetite could amplify bullish sentiment.

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While the recent pickup in foreign insurer activity is notable, analysts caution that global risks remain. Trade relations, geopolitical tensions, and shifting central bank policies could all influence whether this trend gains momentum or stalls.

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Still, the data suggests that the broad pullback from U.S. assets earlier this year may have been more of a temporary pause than a lasting retreat. As insurers regain confidence, their capital flows could once again become a steady source of support for U.S. markets.

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“Insurers need stability to plan for the long term,” Vegari emphasized. “If the U.S. can continue to deliver on that front, we should expect to see even more capital returning.”

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