The Risk Dashboard presents EIOPA's quarterly risk assessment of the European Union insurance industry. With the implementation of the Solvency II regime in January 2016 substantial improvements as regards the risks' quantification and the reporting standards were introduced. The enhanced data of all (re)insurance undertakings subject to the Solvency II regime is the basis of the newly developed and improved analytical Risk Dashboard.
Risk Dashboard April 2019 (Q4-2018 Solvency II Data)
The results of the April 2019 Risk Dashboard show that the risk exposure of the European Union insurance sector remains overall stable.
Macro risks continue at medium level. Low swap rates and recent downward revisions to Gross Domestic Product (GDP) growth and inflation forecasts remain a concern going forward. Credit and market risks remain at medium level amid slightly decreased bond spreads, stable portfolio exposures and broadly unchanged bond volatility. Profitability and solvency risks are stable, with overall unchanged profitability indicators compared to the second half of 2018 and end-2017. Median Solvency Capital Requirement (SCR) ratios are well above 100% for groups, life and non-life solo undertakings. Insurance risks increased to medium level due to a further increase in the catastrophe loss ratio. Market perceptions remain stable at medium level with insurance stocks slightly outperforming the overall market, a reduction in insurance groups' Credit Default Swap (CDS) spreads and unchanged external ratings.
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 fourth quarter of 2018. This data is based on financial stability and prudential reporting collected from 96 insurance groups and 2,873 solo insurance undertakings.
- Reference date for company data is Q4-2018 for quarterly indicators and 2017-YE for annual indicators. The cut-off date for most market indicators is mid-March 2019.
- Risk Levels are based on a 4-level scale from Low (green) to Very high (red). Risk trend reports the quarter on quarter variation of the risk based on a 5-level scale from Substantial Decrease to Large Increase.
EIOPA Risk Dashboard – April 2019
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