EIOPA Financial Stability Report December 2019

Key findings:

  • Risk of a prolonged low yield environment has intensified over the last 6 months and remains the key challenge for European insurers and pension funds, putting pressure on both solvency positions and long-term profitability
  • Combination of weakening economic outlook, concerns over debt sustainability and stretched valuations across financial markets could also give rise to a sudden reassessment of risk premia¬†
  • Emerging cyber and climate change related risks continue to demand attention from insurers, pension funds and supervisors
  • Interconnectedness with banks and home-bias in investments remain high for European insurers and could lead to potential spillovers of risks from other sectors