AIG and AXA among insurers whose bonds fell 1.09%
Fears that insurers face huge claims from the BP/Transocean deepwater Horizon oil spill cause the first monthly decline for corporate bonds since December, Bloomberg reports.
AIG and Axa were among insurers whose bonds lost 1.09% including reinvested interest, according to Bank of America Merrill Lynch index data.
That compares with the negative 0.83% return on debt issued by energy companies hit by BP’s oil rig explosion and the 0.68% loss on notes from banks, also big holders of debt of troubled European nations.
Investors in government bonds
“The insurers’ declines are primarily down to sovereign debt concerns because they’re investors in government bonds, agencies and so on,” said Luis Maglanoc, head of credit research at UniCredit SpA in Munich.
“The costs of the Gulf accident are likely to be indirect, as people claim for injury or loss of livelihood for example, and will be in the future.”