16 October 2008
The Financial Services Authority (FSA) has stepped up its
scrutiny of leading life assurers amid concerns that crumbling
investment markets are putting their solvency levels under
pressure.
The FSA are also concerned that insurance companies are not
stress-testing their exposures hard enough to take account of
market shocks and officials will visit life company offices for a
case-by-case analysis of the way they protect themselves against
their investments going wrong.
Aviva, which owns Norwich Union, Legal & General, Friends
Provident and Prudential have all been contacted by the FSA over
the past fortnight.
Despite sustained falls in the equity and property markets and
the volatility of bonds, there is no suggestion that any UK insurer
is in danger of becoming insolvent as Britain's biggest insurers
have stood up well in the current financial crisis.
