EIOPA releases Financial Stability Report: EIOPA has published its December 2014 Financial Stability Report. The report highlights the key threats to the health of the insurance, reinsurance and occupational pension sectors and other trends affecting them. It concludes the environment remains challenging and is forcing insurers to re-evaluate their business models. Reasons for concern include

  • a weak macroeconomic climate with low interest rates and continuing sovereign credit risk;
  • the fact that certain asset prices do not accurately reflect the risks underlying them; and 
  • insurers reducing profit shares and setting up additional technical provisions to allow them to adapt to the current low yield environment.

The report also notes that the reinsurance sector continues to grow with strong underwriting results and capital returns. EIOPA forecasts in its qualitative assessment that positive premium growth is anticipated only for non-life insurers in early 2015. (Source: EIOPA Financial Stability Report December 2014)