Life - Articles - No deal Brexit would hit life insurers capital and profits


According to a report from Moody’s Investors Service weak economic growth and business and consumer uncertainty would weigh on life insurers’ business in the short to medium term UK life insurers are likely to see their capital and profit damaged if there is a no-deal Brexit.

 However, Moody’s current base case is still that the European Union and the UK will reach an agreement.

 “If the UK leaves the European Union without an agreement, life insurers will suffer in the short to medium term,” said Dominic Simpson, VP-Sr Credit Officer at Moody’s. “First, financial market volatility may erode capital and pressure investment income. Second, a hit to the UK economy may reduce revenue and earnings potential.”

 However, Moody’s anticipates that operational risk will be manageable in the event of a no-deal Brexit, as most UK life groups that operate in continental Europe do so via local subsidiaries.

 These will be able to continue operating even though their UK parents would lose their EU passporting rights. Furthermore, in 2018, most UK life insurers again increased their operating profit. Moody’s expects the sector to continue to benefit from rule changes giving savers more freedom to manage their retirement savings, as well as structural shifts such as pensions auto-enrolment, and the move from defined benefits to defined contribution schemes.

 Access the report here 

Back to Index


Similar News to this Story

Are weight loss medications pre existing conditions
New survey exposes critical gaps in understanding as GLP-1 medications blur lines between medical treatment and lifestyle choices. Consumer Intelligen
Statistics on the very old including centenarians
Catherine Foot, director of the Standard Life Centre for the Future of Retirement, comments on ONS statistics on estimates of the very old, including
Warning against Budget price increases on private health
Hike in IPT could prove counter-productive for the UK economy by limiting take up of private healthcare options. Could create a ‘double whammy’ impact

Site Search

Exact   Any  

Latest Actuarial Jobs

Actuarial Login

Email
Password
 Jobseeker    Client
Reminder Logon

APA Sponsors

Actuarial Jobs & News Feeds

Jobs RSS News RSS

WikiActuary

Be the first to contribute to our definitive actuarial reference forum. Built by actuaries for actuaries.