London - Tests show capital risks to insurers
Tuesday, 01 31 2017, Category: Insurance and Reinsurance, Country: United Kingdom
A major $200 billion loss from a combination of a cyber attack, U.S. hurricane and the failure of a reinsurer could strip insurers of up to 120 percent of their net capital base, tests of insurers in London showed.
However, capital-raising or asset sales meant losses would not put the insurers out of business, according to the results of the tests published on Tuesday.
Nine insurers and reinsurers staged two weeks of catastrophe simulations in London last November, dealing with a cyber attack on power grids across 15 U.S. states, a 16 percent slide in global stocks, a category 5 hurricane over Miami, Florida and the failure of a major reinsurer.