Insurers Warned Over Capital Ahead Of 2021 'Cliff Edge'
Law360, London (December 21, 2020, 1:27 PM GMT) -- A European watchdog has urged insurers to exercise caution in managing capital levels, warning of a "potential cliff edge" for economies next year when government COVID-19 support ends.
Insurers should weigh the risks of making dividend payments to investors or going ahead with share buy-back programs amid the uncertainty over the long-term effects of the pandemic, the European Insurance and Occupational Pension Authority said on Friday.
The watchdog told insurers in April to suspend dividends, but the warning received a mixed response from national regulators. Many insurance companies said they would continue to pay dividends regardless.
"EIOPA strongly recommends insurers to maintain extreme...
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