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ARTICLE · 17 OCTOBER 2011

European Insurance Stress Test

Dillon Eustace
Dillon Eustace
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Dillon Eustace

Dillon Eustace

Dillon Eustace is one of Ireland’s leading law firms focusing on asset management and investment...

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On 4 July 2011, EIOPA announced the results of the second Europe-wide stress test for the insurance sector which took place between March and May 2011.

IrelandInsurance

To read the Insurance Quarterly Legal And Regulatory Update in full please click here.

On 4 July 2011, EIOPA announced the results of the second Europe-wide stress test for the insurance sector which took place between March and May 2011. Overall it considered that the European insurance industry remains robust.

The stress test sought to ascertain the exposure of the insurance industry to adverse capital market developments based on future Solvency II requirements. As such, it assessed whether the European insurance industry can meet minimum capital requirements ("MCR"), the ultimate regulatory threshold, under a number of stress scenarios comprising market, credit and insurance related risks. The main market risk drivers identified were equity prices, interest rates and sovereign bonds, while the main insurance risks were increased claims inflation and natural disasters.

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