The European Insurance and Occupational Pensions Authority has published its June 2026 Financial Stability Report, concluding that the European insurance and occupational pensions sectors remained resilient despite moderate growth, heightened geopolitical uncertainty and recent market volatility. Strong capitalisation and liquidity helped insurers and pension funds absorb turbulence linked to geopolitical developments, the repricing of financial risks and changes in global trade arrangements. At the same time, the report says vulnerabilities remain from financial market movements, operational risks, claims inflation and broader structural pressures. The report highlights geopolitical tensions as the main concern identified by supervisors and examines related risks from trade fragmentation, fiscal adjustment and rising defence spending needs. It also points to longer-term issues including demographic trends, climate-related risks and the growing use of artificial intelligence, which may improve efficiency but also raise cyber, third-party dependency, data governance and operational resilience risks. For 2025, insurers were described as well capitalised and liquid, with premium growth and higher investment returns supporting profitability, while reinsurers maintained robust profitability and stronger solvency despite slower premium growth in some segments. Occupational pension funds remained stable, with broadly unchanged total assets and improved average funding ratios, and the report also reviews the Dutch pension system's transition to a defined contribution framework. Across the sectors, sovereign exposures, links to banks and other financial institutions, private markets and valuation risks in less liquid assets remain areas for monitoring, even though aggregate exposures to private credit are still relatively limited.
European Insurance and Occupational Pensions Authority2026-06-24
European Insurance and Occupational Pensions Authority report finds insurers and pension funds resilient but flags geopolitical and private market risks
The European Insurance and Occupational Pensions Authority's June 2026 Financial Stability Report says European insurers and occupational pension funds remained resilient through recent market volatility, supported by strong solvency and liquidity positions. It identifies geopolitical tensions as the main supervisory concern and also flags risks tied to private markets, less liquid asset valuations, operational resilience and artificial intelligence. Insurers, reinsurers and pension funds all remained broadly stable in 2025, although several market and structural vulnerabilities continue to require monitoring.