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EU watchdog pulls more small insurers into 2016 stress test
May 24, 2016 / 1:01 PM / a year ago

EU watchdog pulls more small insurers into 2016 stress test

FRANKFURT, May 24 (Reuters) - EU insurance watchdog EIOPA has expanded the scope of this year’s test of the sector’s financial resilience to include more smaller insurers, seen as especially vulnerable to low interest rates and a potential flash point for wider trouble.

The stress tests, run every other year by the European Insurance and Occupational Pensions Authority (EIOPA), will focus on two major market risks in 2016: prolonged low interest rates and a “double hit” scenario, where low rates are combined with a sudden drop in asset prices.

“In order to include a higher number of small and medium size insurers, the participation target was increased from a 50 percent in 2014 to a 75 percent share of each national market in terms of gross life technical provisions,” EIOPA said in a statement on Tuesday. (Reporting by Jonathan Gould; Editing by Harro ten Wolde)

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