PRA has issued a “Dear CEO” letter on continuing soft market conditions in the UK general insurance sector. The letter explains that continuing low interest rates and another year without significant natural catastrophes are increasing the competitive pressures in many areas. It also notes an abundance of (re)insurance capacity, which in part is driven by capital market structures that allow a wider range of investors easy access to specific insurance risks. This letter’s consideration of underwriting, reserving, reinsurance and assessments of capital requirements was in line with a previous speech on policy priorities for prudential regulation and supervision (see FReD 4 December). (Source: PRA Dear CEO Conditions in General Insurance Sector)