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Life insurers are better positioned to face the next financial crisis

by

Hubert Roy

June 3, 2019 13:30

For Standard & Poor’s, if a financial crisis equivalent to that of 2008-2009 were to occur today, the insurers established in the United States would suffer less the consequences that ten years ago.

These analysts have reached this conclusion in the report When the Cycle Turns : Investment Impairments Will Bend but Not Break U. S. Life Insurers’ Financial Strength, published in mid-may. However, some insurers may be more affected than others, prevent they.

The experts of Standard & Poor’s even argue that a possible financial crisis might dig a hole of $ 20 billion in their capital. This represents 5 % of what the industry puts aside to meet the solvency requirements of regulators.

Deep Banerjee, credit analyst at Standard & Poor’s, recalls that, following the financial crisis of 2008-2009, his company had downgraded the prospects for the development of life insurers american. This perspective was dropped from stable to negative. The firm’s rating was revised negatively the odds of developing a thirty life insurers. In the event of a new crisis, such a situation should not happen again, he predicted, as insurers have a better margin of sufficiency in their capital.

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