Lower interest rates accelerate insurance profit decline in Europe, constrain solvency ratios

European insurers’ investment income is expected to decline by €10bn-£25bn every year in the next five years, if interest rates and investment allocation remain unchanged, says Moody’s.

“Based on our analysis of EIOPA’s reference investment frankfurt-westhafentower-eiopa-officesportfolios, we expect European life insurers’ investment yields to decline by 10-30bps every year in the next five years, assuming unchanged interest rates and investment allocation.

European P&C insurers’ investment yields will decline further given the shorter duration of their assets,” says Benjamin Serra, a vice president and senior credit officer at Moody’s.

Continue Reading “Lower interest rates accelerate insurance profit decline in Europe, constrain solvency ratios” at FTSE GM

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