AM BestTV: Germany’s Life Sector Burdened by Product Commitments and Reserving, Says AM Best Financial Analyst

OLDWICK, N.J.--()--In this AMBestTV episode, Martina Seydoux, financial analyst, AM Best, said Germany’s life insurers are squeezed by commitments to products that require higher margins, although amended regulations will require them to reserve less against prolonged low interest rates. Click on http://www.ambest.com/v.asp?v=germanlife519 to view the entire program.

Seydoux highlighted a few of the main drivers for AM Best’s negative outlook on Germany’s life insurance sector.

“The main reasons for the negative outlook are the persistent low interest-rate environment and the limited ability of German life insurers to change their business mix,” said Seydoux. “AM Best expects these players to remain reliant on the traditional products with interest rate guarantees that currently are costly. The next driver is the pressure on operating earnings, which the recent legislative change has lighten.”

Seydoux also addressed the balance sheet strength of Germany’s life insurers.

“On the aggregated balance sheet level, AM Best views it as strong. There are differences amongst the various players in the market; however, mainly for the larger insurers, their balance sheets remain strong. As for the smaller players, they are likely to continue reporting more modest solvency levels.”

To access a copy of this market segment report, titled, “Market Segment Outlook: Germany Life”, visit http://www3.ambest.com/bestweek/purchase.asp?record_code=284268 .

Recent AMBestTV episodes:

  • Despite Storms, Outlook for Germany’s Non-Life Sector Stable, Says AM Best Financial Analyst: Konstantin Langowski, financial analyst, AM Best, said despite a slight deterioration of the combined ratio for Germany’s non-life industry in 2018, the overall sector's financial condition still supports a stable market segment outlook: http://www.ambest.com/v.asp?v=germannonlife419.
  • To Cover the Biggest Risk Needs, Think Microinsurance: Attendees at the International Insurance Society (IIS) Global Insurance Forum said insurers coming together to create programs and products, along with technology, are helping to bring insurance coverage to developing and impoverished regions: http://www.ambest.com/v.asp?v=iis3619.
  • Closing the Protection Gap Takes More Than Insurance: Insurers gathered at the IIS Global Insurance Forum said new analytic tools and better risk reduction will help reduce losses to disasters, not just transfer more risk to insurers: http://www.ambest.com/v.asp?v=iis2619.
  • Insurers' Biggest Risk Is Losing Touch With the Customer: Attendees to the IIS Global Insurance Forum said insurers are leveraging technology and analytics, but are competing with a wider range of service providers for the attention and trust of customers: http://www.ambest.com/v.asp?v=iis1619.

AM BestTV covers exclusive AM Best and insurance industry information and reports, targeted topics and key developments in the insurance, reinsurance and related sectors daily. Sign up for alerts of episodes at http://www.ambest.com/multimedia/ambtvsignup.html. View AM BestTV episodes at http://www.ambest.tv.

AM Best is a global rating agency and information provider with a unique focus on the insurance industry. Visit www.ambest.com for more information.

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Contacts

Lee McDonald
Group Vice President, Publication and News Services
+1 908 439 2200, ext. 5561
lee.mcdonald@ambest.com

Contacts

Lee McDonald
Group Vice President, Publication and News Services
+1 908 439 2200, ext. 5561
lee.mcdonald@ambest.com