OLDWICK, N.J.–(BUSINESS WIRE)–In this AMBestTV episode, Catherine Thomas, Mahesh Mistry and Angela Yeo, senior directors at AM Best, said changing issues such as regulation, along with greater awareness of ESG and cyber risks, are helping insurers sharpen their focus on operational and financial issues. Click on http://www.ambest.com/v.asp?v=europeanmarket819 to view the entire program.
Thomas highlighted how Brexit is weighing on insurers in the U.K. market.
“Brexit is definitely on the minds of insurers in the United Kingdom and has been for the past few years,” said Thomas. “Not just the London market, but the whole U.K. insurance market. It is the economic and political uncertainties associated with it that are weighing on the overall market. Once Brexit occurs, there is the economic fallout from it that will clearly impact all insurers across the market. It is difficult at this stage to predict with any certainty as to what that impact will be.”
With interest rates remaining at historic lows across Europe, Yeo addressed what impact this is having on insurers.
“The interest rates in Europe really have been low since the financial crisis. I would say that it has almost become the new norm; nevertheless, the markets generally have adapted to it. With the exception of the German life sector, AM Best has seen that throughout the various European countries that their capitalization is still very strong,” she said.
Looking at the Middle East and North Africa (MENA) markets, Mistry spoke about the divergence between the countries rich in resources compared with the rest.
“AM Best has seen that most of these Middle Eastern markets—particularly, the GCC oil-rich markets—are dominated by a few players, who drive the premiums in the market, and have more than their fair share of profitability. After those, many, many companies are left chasing very little premiums in the market.”
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