PRA warns insurers on claims inflation and under-reserving
The Prudential Regulation Authority has written to insurers flagging the need to monitor the hit to reserves from ongoing claims inflation and act accordingly.
In a letter to general insurance chief actuaries, it reported: “We expect claims inflation to affect all general insurance firms, although the nature of the impact will vary depending on the firm’s business model and risk profile.
“There is a risk that persistently elevated claims inflation might result in a material deterioration of solvency coverage for some firms unless they take appropriate mitigating actions.”
There is a risk that persistently elevated claims inflation might result in a
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