Tuesday,
April 17, 2018 /11:20 AM/ Fitch Ratings
The global insurance industry is weathering key
macro risks that could have a lasting effect on the sector globally, risks that
Fitch Ratings identifies in a new report that details global and regional
insurance sector outlooks.
"Competitive market conditions and low
investment yields, particularly in the U.S. and U.K., are making it difficult
for (re)insurers to earn adequate returns," said Mark Rouck, Fitch's Group
Credit Officer for Insurance.
The aforementioned headwinds underpin Fitch's
negative sector outlooks on the reinsurance and non-life sectors. Conversely,
benign credit market conditions contribute to a stable life insurance outlook,
and gradual increases in market interest rates could further benefit life
insurers.
"Fitch is keeping a close eye on key macro
risks throughout the world including a possible negative turn in the credit
cycle, a more rapid than anticipated increase in interest rates, and a
potential deceleration of growth in China," said Rouck.
Fitch's report provides perspective on which
insurance markets throughout the world will feel the brunt of these effects
most acutely. It also addresses the scope of potentially affected insurers
within Fitch's rated universe. 
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