With dramatic share price dives and swirling uncertainty immediately following the UK’s vote to leave the European Union, analysts are working to figure out what it all means for insurers.
Autonomous Research, an investment research company, has issued its European Insurers report and updated its ratings following the wreckage of the Brexit.
In the report, Autonomous research stated it was already struggling to identify growth within most insurance businesses, and now expects growth to only slow further.
The agency has downgraded Dutch insurer Delta Lloyd to ‘underperform’ from ‘neutral’. While Delta Lloyd might seem to be largely unaffected by the Brexit, Autonomous is concerned about the sustained fall in Europe’s interest rates and their effect on the company’s dividend capacity.
Still, it hasn’t been negative news for everyone, with two insurers receiving increased ratings. Standard Life has been upgraded from ‘neutral’ to ‘outperform’ thanks to its balance sheet and strong position to weather a potential UK recession. Swiss Re, meanwhile, was upgraded to ‘neutral’ from ‘underperform’, largely thanks to its minimal exposure to potential Brexit chaos.
The report also highlights Aviva
as insurers the research company expects to outperform; while Vienna and Ageas
join Delta Lloyd as being listed as underperforming.
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