Insurers are struggling with investment strategies, with more than half citing weak economic growth and low interest rates among their chief concerns, according to a survey by investment group BlackRock.

The poll of 315 global insurer investment managers shows these long-standing concerns have been amplified by the UK’s vote to leave the European Union, with more than 100 respondents saying this will reinforce long-term trends.

“Insurers face a mighty squeeze. Many traditional investment assets no longer meet their needs, while the alternatives bring a range of issues including a chronic shortage of supply and issues with implementation,” the investment management group’s report says.

“Slow growth and heightened geopolitical risk are major concerns globally.”

Most insurers will maintain current levels of investment risk, despite the quest to find higher returns.

Low interest rates are considered the major market risk by 59% of insurers, while 57% are concerned about asset price volatility.

It is expected interest rates will remain low even longer after the Brexit vote.

Only 8% of insurers will reduce their investment risk in the future, while 47% will increase it, including more exposure to higher-risk credit investments and equities and continuing exposure to cash and government bonds.

“However, insurers’ willingness to assume greater investment risk contrasts with the large percentage that expect to increase their allocation to cash during the next 12-24 months, and the similarly large proportion that plan greater exposure to government bonds in spite of low yields,” the report says.

The research suggests insurers may be building their cash exposure due to a lack of investment opportunities amid demand for government bonds.

“We also suspect that the need to hold cash to cover variation margin on cleared derivative positions and collateral on over-the-counter positions is a significant contributory factor,” the report says. “Although sentiment towards equities remains cool, it has become considerably less negative since last year’s survey.”

Many insurers plan to invest in private market assets, with more than half considering direct mortgages and 49% aiming to increase exposure to private equity.

Regulatory conditions are a concern for 46% of respondents, with capital charges cited as the biggest external barrier to investment.