Overview
The external environment surrounding Europe's insurance markets
Regarding the external environment surrounding Europe’s insurance markets, some signs of favourable developments have been observed in the first half of 2013.
European insurers showed relatively stable results in 2012. Investment returns improved due to increased asset prices, which combined with cost cutting efforts saw return on equity picking up in the second half of 2012. As for capitalisation levels, solvency ratios (on a Solvency 1 basis) in 2012 showed a moderate upwards trend, especially for non-life insurers, providing sizable buffers to weather economic pressures in the Eurozone or challenging financial market conditions. Reinsurance undertakings also showed a good operating performance in 2012 benefiting from a capital inflow to the sector with investors looking for stable returns in volatile markets. Losses from natural catastrophes remained significantly lower than in 2011 and 2005, the worst year ever...
