Increasing exposure to liabilities such as asbestos is seriously eroding the financial strength of insurers. That's according to a study by Oxford Metrica.
The financial consultancy found that the major UK insurers felt the trend had yet to stabilise.
Deborah Pretty of Oxford Metrica said: "The frequency and size of claims continues to increase apace and has considerable impact on the strength of (re)insurers' reserves and their long-term ability to pay claims."
According to the survey there had been 16 downgrades over the past four months - reflecting growing concerns over insurers' capital back up.
The study also found several insurers had strengthened their reserves significantly to adapt to a changing risk profile.
Other insurers have withdrawn from long-term, or "long-tail", liability lines to improve their capital position. Although this has led to an erosion of capacity and rising premiums, it said.
