When the Cycle Turns: S&P on Insurer Capital

via S&P Global

When will the economy turn down? Nobody knows for certain, but S&P stress tested capital of different insurers. Alt-capital owned insurers did the worst. But those insurers hold investments that may difficult to stress test.

"The current U.S. economic expansion is set to become the longest in U.S. history. At the same time, the guessing game around when it will reverse its course has taken center stage. With the debate around the inevitable end of the cycle as a backdrop, S&P Global Ratings undertook a hypothetical stress test to estimate the impact of a potential market downturn on U.S. life insurers. Our analysis indicates that, on an aggregate level, our rated U.S. life insurers could see a net impact of about $20 billion or about 5% of total adjusted capital (TAC) from asset stress in an upcoming downturn."

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When the Cycle Turns: S&P on Insurer Capital

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