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European insurers facing fixed income devaluations of more than €500bn

Written by Adam Cadle
24/11/2023

European insurers face substantial unrealised losses on fixed income investments exceeding €500bn due to rapidly soaring interest rates in 2022, S&P Global Ratings has said.

Despite this, it said the insurance sector remains resilient, displaying a slow but sturdy journey to recovery.

Furthermore, S&P Global Ratings urged caution around illiquid investments, real estate, private equity, and private debt.

European insurers maintain a key strength in their capital surplus, providing a cushion above minimum capital adequacy requirements to support current ratings.

Although the value of investments eroded capital surpluses by about €30bn in 2022, S&P Global Ratings said it anticipates a gradual recovery.


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