Financial Stability Report for December 2022 was published on 15 December.
The report examines key risks and developments in Europe’s insurance and occupational pensions sectors. Additionally, it presents four topical focuses, notably about the impact of rising inflation and interest rates on insurers’ financial position, insurers’ use of derivates and related liquidity needs, the growing relevance of life portfolio transfers, as well as non-life insurers’ underwriting exposure to physical climate change risk.
Despite the challenging environment, insurers and pension funds have thus far weathered the shocks well. Entities have sought to adapt to the changing landscape and reduced their vulnerabilities for instance by optimising risk management processes via portfolio transfer and product design.
Nevertheless, risks connected to claims inflation, the potential widening of corporate and sovereign spreads, the deteriorating macroeconomic outlook and liquidity management in a period of rapidly rising interest rates remain and require monitoring.
Please find more information here.
Insurance Europe has prepared summary of EIOPA’s Financial Stability Report.