Specialist pension provider Just Group on Thursday posted a drop in solvency ratio as interest rates fell across regions with countries taking measures to stimulate their economies due to the COVID-19 pandemic.
In a trading statement ahead of its annual general meeting, the company flagged a three point drop in its Solvency II coverage ratio to 138% at the end of April 2020.
European Solvency II rules dictate the amount of capital an insurer must hold to reduce the risk of insolvency. The lower the ratio, the greater the chances of a company defaulting on its obligations.
A level above 100% indicates an insurer has sufficient capital, though regulators prefer to see higher solvency levels, industry sources say.
(Reporting by Muvija M in Bengaluru; editing by Carolyn Cohn)