Quarterly insurance update Q4 2022

Since our last update, there has been significant volatility in UK assets and Sterling post the October mini-budget announcement. We have seen continued higher levels of inflation emerging globally, with further interest rate increases in reaction to these.

This has led to growing fears of recession in the UK, Europe and the US. In addition, reviews of the regulatory frameworks within both the UK and wider Europe have continued to progress – with the UK Government announcing their intention to replace Solvency II and the PRA (Prudential Regulation Authority) providing feedback on insurers’ progress around incorporating climate risks. In Europe, EIOPA (European Insurance and Occupational Pensions Authority) provided further guidance on the use of scenario analysis in ORSAs (Own Risk and Solvency Assessments) for climate risks, and a progress update on the current review of Solvency II including remaining areas of negotiation and challenge.

Within this quarterly update, we cover developments to the two main areas most prevalent to the asset side of insurers’ balance sheets - investment markets and regulations. In addition, we highlight two investment themes we believe should be considered by many insurers at the present time.

Read in full: Quarterly insurance update Q4 2022

This is a financial promotion and is not investment advice. The views expressed are those of the authors at the date of publication unless otherwise indicated, which are subject to change, and is not investment advice.