European insurers under threat of declining financial markets

Stress tests conducted in 2014 show that the occurrence of these risks would have a negative impact on insurers. A "cross" shock involving a fall in financial markets combined with a decline of interest rate for risk-free assets stands as a threat to insurers.

This is particularly true in life insurance where profitability is threatened by the increase in the technical reserves and the persistence of low rates of interest. EIOPA has concluded that the value of certain assets is overrated in relation to the risk they pose, thus rendering possible the collapse of financial markets.