Featured Product

    EIOPA Dashboard Examines Risks in Insurance Sector

    February 09, 2021

    EIOPA published the risk dashboard based on the Solvency II data from the third quarter of 2020. The dashboard uses a set of risk indicators to summarize key risks and vulnerabilities in the insurance sector in EU. The results show that insurers’ exposures to macro risks decreased from very high to high level, while all other risk categories remain at medium level. Going forward, European supervisors expect an increase in credit, market, and underwriting risks over the next 12 months, reflecting concerns over second lockdowns due to the new waves of the pandemic as well as potential cliff effects once fiscal support measures cease to apply.

    In addition, the Solvency Capital Requirements (SCR) ratio for insurance group undertakings slightly improved from the second quarter 2020 to the third quarter of 2020, although remaining at lower levels than in the last quarter of 2019. Profitability and solvency risks, along with the liquidity and funding risks, remain at medium level. The results also show that financial markets positively reacted to the COVID-19 vaccine news in the second half of 2020, with market and credit risk indicators stabilizing. However, the potential disconnect between the market performance and the economic outlook remains a concern, as it could result in sharp valuation adjustments. The credit-worthiness of assets in insurers’ portfolios is under close monitoring. Looking ahead, an increasing trend for market and credit risks is expected over the next 12 months due to the high uncertainty and the concerns related to decoupling between financial market performance and economic outlook. 

     

    Related Links

    Keywords: Europe, EU, Insurance, Risk Dashboard, Credit Risk, Market Risk, SCR, Solvency II, Liquidity Risk, EIOPA

    Featured Experts
    Related Articles
    News

    BCBS Consults on Guidelines for Counterparty Credit Risk Management

    The Basel Committee on Banking Supervision (BCBS) is seeking comments, until August 28, 2024, on guidelines for counterparty credit risk management of banks.

    May 21, 2024 WebPage Regulatory News
    News

    ISSB Releases Digital Sustainability Disclosures Taxonomy

    The themes of the harmonization and interoperability of sustainability disclosure standards among various jurisdictions remain at the top-of-mind for international standard-setting bodies.

    May 21, 2024 WebPage Regulatory News
    News

    BCBS Report Studies Implications of Digitalization of Finance

    The Basel Committee on Banking Supervision (BCBS) published a report that examines the implications of the digitalization of finance for banks and supervisors.

    May 21, 2024 WebPage Regulatory News
    News

    HKMA Publishes Hong Kong Taxonomy for Sustainable Finance

    The Hong Kong Monetary Authority (HKMA) published the Hong Kong Taxonomy for Sustainable Finance.

    May 21, 2024 WebPage Regulatory News
    News

    EU Taking Steps to Set Out and Enforce AI Regulations

    Many believe that the transformative power of generative artificial intelligence (GenAI) has potential to reshape the financial sector in the time to come.

    May 21, 2024 WebPage Regulatory News
    News

    BIS Paper Outlines Vision for Future Financial System

    In a recent paper, the General Manager of Bank for International Settlements (BIS) and the Indian entrepreneur (Infosys co-founder) Nandan Nilekani have laid out a vision for the Finternet, which is proposed to be a network of multiple financial ecosystems, much like the internet.

    April 29, 2024 WebPage Regulatory News
    News

    NGFS Outlines Options for Supervisory Review of Transition Plans

    The Network for Greening the Financial System (NGFS) recently published three reports on the use of transition plans to boost sustainable finance and manage climate-related financial risks.

    April 29, 2024 WebPage Regulatory News
    News

    BCBS Issues Discussion Paper on Climate Scenario Analysis

    The Basel Committee on Banking Supervision (BCBS) issued a discussion paper on the use of climate scenario analysis to strengthen the management and supervision of climate-related financial risks.

    April 29, 2024 WebPage Regulatory News
    News

    OSFI Issues Phase2 Consultation on Climate Scenario Exercise for Banks

    The Office of the Superintendent of Financial Institutions (OSFI) recently announced a consultation on the second phase of the Standardized Climate Scenario Exercise (SCSE) for banks and other financial institutions it regulates in Canada.

    April 25, 2024 WebPage Regulatory News
    News

    CFIT to Chair Open Finance Taskforce Announced by UK Government

    The UK government announced the formation of an industry-led Open Finance Taskforce, chaired by the Center for Finance, Innovation, and Technology (CFIT).

    April 25, 2024 WebPage Regulatory News
    RESULTS 1 - 10 OF 8967