General Insurance Stress Test

In 2015 the Prudential Regulation Authority (PRA) conducted a General Insurance Stress Test exercise for all Category 1 and 2 UK regulated general insurers. 63% of the general insurance market (by premium) participated, covering 26 insurance groups across 39 legal entities.

The purpose of this exercise was to assess the market-wide impact of specific scenarios, to assess how these losses would be borne by different firms, and to explore individual firms’ vulnerabilities.

In this briefing note we review the eleven stress tests that insurers were asked to consider, as grouped into the following three categories:

  • market-wide scenarios
  • difficult-to-assess scenarios
  • horizon scenarios

Holly Deakin contributed to this briefing note. Download the full note below to find out more.