Ratings agency says credir drunch will hit Lloyd's in the second quarter.
Lloyd’s insurers are set to take a hit from the credit crunch in the second-quarter results season, Standard & Poor’s said this week.
Financial performance will depend on astute investments in the coming results season, at a time when equity markets show little sign of rebounding amid falling share values, the analyst said.
S&P analyst Mark Nicholson told Insurance Times: “Investments will probably hit balance sheets, especially in the second-quarter. Investment mix will make much of a difference to profit levels.”
But S&P analysts sounded an optimistic note after highlighting hidden opportunities for insurers in the current economic climate.
In a report analysing the effects of financial markets on insurers, S&P said: “One of our conclusions regarding the more direct effects of the credit crunch is that the insurance sector could be well placed, in the context of unmet demand for longer-term liquidity and widening credit spreads, to be paid more for supplying that liquidity.”
The report added that: “We recognise that, to varying degrees, price weakness in insurers’ existing holdings of financial assets will be the focus of attention but, as the primary holders of long-term liabilities, they should also be the natural buyers of long-term credit market assets.”
Hosted by comedian and actor Tom Allen, 34 Gold, 23 Silver and 22 Bronze awards were handed out across an amazing 34 categories recognising brilliance and innovation right across the breadth of UK general insurance.
