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Europe > Norway

You are looking at 1 - 6 of 6 items for :

  • Type: Journal Issue x
  • Insurance; Insurance Companies; Actuarial Studies x
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Cover IMF Working Papers
Did Insurers Become Risk-Loving During “Low-for-Long”? The Role of Returns, Ratings, and Regulation
Jeroen Brinkhoff
and
Mr. Juan Sole
European life insurance companies are important bond investors and had traditionally played a stabilizing role in financial markets by pursuing “buy-and-hold” investment strategies. However, since the onset of the ultra-low interest rates era in 2008, observers noted a decline in the credit quality of insurers’ bond portfolios. The commonly-held explanation for this deterioration is that low returns pushed insurers to become more risk-taking. We argue that other factors—such as surging rating downgrades, bond revaluations, and regulatory changes—also played a key role. We estimate that rating changes, revaluations, and search for yield each account for about one-third each of the total deterioration in credit quality. This result has important policy implications as it reestablishes the view that insurers’ investment behavior tends to be passive through the cycle—rather than risk-seeking.
Keywords:
Life Insurance sector; financial stability; credit ratings; bond revaluation; life insurance insurance company; bond portfolio; investment behavior; bond investor; Bonds; Insurance companies; Corporate bonds; Sovereign bonds; Bond ratings; Global
Cover IMF Staff Country Reports
Norway: Financial Sector Assessment Program-Technical Note-Insurance Sector Oversight
International Monetary Fund. Monetary and Capital Markets Department
The Norwegian insurance sector is well-capitalized. In recent years, the authorities have taken steps to recapitalize weak insurers and to boost capital for the overall industry. Risk-resilience has been strengthened by stronger retention of profits leading to accumulation of reserves, better risk management, and higher capital in the run-up to the implementation of the Solvency II regulatory regime.
Keywords:
ISCR; CR; FSA issues circular; FSA-run stress test; insurance undertaking; risk outlook; inspection program; main focus; nonlife insurance; risk assessment; balance sheet; rate of return; guarantee scheme; profitability prospects; FSA department; Insurance companies; Insurance; Financial stability assessment; Solvency; Stress testing; Europe
Cover IMF Staff Country Reports
Denmark: Financial Sector Assessment Program-Technical Note-Insurance Regulation and Supervision
International Monetary Fund. Monetary and Capital Markets Department
Denmark’s insurance sector is highly developed with a particularly high penetration and density in the life sector. Traditionally, work-related life insurance and pension savings are offered as a combined package, and life insurance companies dominate the market for mandatory pension schemes for employees. The high penetration explains the overall size of the insurance sector, which exceeds those of peers from other Nordic countries and various other EU member states. Assets managed by the insurance industry amounted to 146 percent of the GDP at end-2018, compared to 72 percent for the EU average.
Keywords:
ISCR; CR; risk assessment; business intelligence tool; insurance undertaking; DFSA plan; DFSA data; DFSA staff; DFSA supervision; insurance sector; insurance supervisor; covered bond; Insurance companies; Insurance; Solvency; Pension spending; Insurance supervision; Global
Cover IMF Staff Country Reports
Norway: Financial Sector Assessment Program-Technical Note-Insurance Sector Stress Tests
International Monetary Fund. Monetary and Capital Markets Department
This Technical Note presents key findings of insurance sector stress tests on Norway. Although the financial condition of insurance companies under Solvency I has generally been sound, insurers face major challenges going forward, thus placing an important premium on sound risk management and effective oversight by supervisors. The stress tests (under Solvency II) confirm that life insurers are vulnerable to severe shocks. The stress tests pointed to the high sensitivity of life insurers to market risks such as equity prices, real estate prices, and credit spreads. The risks to insurers are particularly pronounced if interest rates fall further from the current levels.
Keywords:
ISCR; CR; risk; capital; underwriting; regulation; market; Norway; Solvency II; capital requirement; biometrical risk assumption; risk diversification; capital needs; Solvency II light; capital holding; buffer capital; health underwriting; Solvency indicator; insurance liability risk; capital holding of the insurance undertaking; Insurance companies; Insurance; Stress testing; Solvency; Financial stability assessment; Global
Cover IMF Staff Country Reports
Norway: Financial System Stability Assessment, including Reports on the Observance of Standards and Codes on the following topics: Banking Supervision, Insurance Regulation, and Payment Systems
International Monetary Fund
This paper presents key findings of Norway’s Financial System Stability Assessment, including Reports on the Observance of Standards and Codes on Banking Supervision, Insurance Regulation, and Payment Systems. Norway’s financial system appears sound and well managed. Short-term vulnerabilities appear low overall, given improved macroeconomic conditions and historically low interest rates, coupled with generally prudent and transparent policies. Beyond the short term, however, rising household debt levels are the most important potential risk factor and will need to be watched closely.
Keywords:
ISCR; CR; bank; market; financial system; liquid asset; firm FX price; counterparty risk survey; market risk; settlement bank; moral hazard-type risk; debt ratio; banks' CAR; area bank; settlement risk; banking market; banking book risk; Insurance companies; Insurance; Market risk; Financial sector stability; Global
Cover IMF Working Papers
Work Absence in Europe
Mr. Leo Bonato
and
Ms. Lusine Lusinyan
Work absence is an important part of the individual decision on actual working hours. This paper focuses on sickness absence in Europe and develops a stylized model where absence is part of the labor-leisure decision made by workers and the production decision made by profit-maximizing firms, with insurance provisions and labor market institutions affecting the costs of absence. The results from a panel of 18 European countries indicate that absence is increased by generous insurance schemes where employers bear little responsibility for their costs. Shorter working hours reduce absence, but flexible working arrangements are preferable if labor supply erosion is a concern.
Keywords:
WP; sickness absence; labor force; sick pay; labor market; unemployment insurance; working time; social insurance; panel data; Europe; absence rate; employment protection; sickness insurance; Insurance; Employment protection; Labor supply; Unemployment benefits