EIOPA’s Risk Dashboard – second quarter 2017 – continues to show a relative stable risk exposure of the European Union insurance sector

27/10/2017

EIOPA’s Risk Dashboard – second quarter 2017 – continues to show a relative stable risk exposure of the European Union insurance sector

Today, the European Insurance and Occupational Pensions Authority (EIOPA) published its updated Risk Dashboard based on the second quarter 2017 data.

 

The results show that the risk exposure of the insurance sector in the European Union remains overall stable with some slight improvements in the solvency ratios of groups and life solo undertakings. Profitability of the sector has shown some positive signs both for life and non-life. Inflation rate forecast is decreasing inverting the positive trend observed till March 2017, whereas unemployment rates continue to decrease. Despite some positive developments, the continuing low-yield environment and the observation that market fundamentals might not properly reflect the underlying credit risk, are still important concerns for the European insurance industry. Recent natural catastrophe events have not yet been reflected in the data, therefore no impact on the industry is shown at this stage. Market perception, driven by the outperformances of the insurance stocks and the reduction of the Credit Default Swap Spreads, improved. Ratings and rating outlooks remain stable.

 

Background

 

This Risk Dashboard based on Solvency II data summarises the main risks and vulnerabilities in the European Union insurance sector through a set of risk indicators of the second quarter of 2017. This data is based on financial stability and prudential reporting collected from 93 insurance groups and 3,076 solo insurance undertakings.